Originally published April 24 2014
'Retail tsunami' of bankruptcies and closings now sweeping America
by J. D. Heyes
(NaturalNews) A combination of factors is causing a rash of store closings for many of the nation's retailers, moves which will affect scores of Americans who rely on them for employment.
According to the site WealthyDebates.com, a "retail tsunami" is sweeping the country, as one major retailer after another announces plans to trim floor space and outlets, even as the Obama administration and the mainstream media report improving employment opportunities.
As further reported by CNBC:
Get ready for the next era in retail--one that will be characterized by far fewer shops and smaller stores.
On Tuesday, Sears said that it will shutter its flagship store in downtown Chicago in April. It's the latest of about 300 store closures in the U.S. that Sears has made since 2010. The news follows announcements earlier this month of multiple store closings from major department stores J.C. Penney and Macy's.
And that is just a very small list of retailers. There are plenty of others planning similar cuts, both large and small, as compiled by WealthyDebates.com:
--Staples: This office supplier has said it will close 225 stores by 2015, which amounts to about 15 percent of its total chain. Staples closed 40 stores last year, and industry analysts believe the chain's main competitor, Office Depot -- which bought out OfficeMax in 2013 -- will announce its own store closings soon. Some have already shuttered in recent months.
--RadioShack: The chain has announced plans to close 20 percent of its retail stores this year, which could be as many as 1,100 stores. RadioShack, an electronics outlet, operates about 4,000 stores; the company reported that overall sales fell by 19 percent in 2013.
--Albertsons: According to Supermarket News, this grocery chain shuttered 26 stores in January and February of this year. Some industry analysts say many more Albertsons stores could close because the chain's owner, hedge fund Cerberus Capital Management, recently purchased a rival grocery chain, Safeway, Inc., though some of those could shut down soon as well.
--Abercrombie & Fitch: 24/7 Wall St. reports that the hip clothing retailer made popular in song during the 1990s plans to close 220 of its stores by the end of 2015. Also, the company plans to shutter an entire chain that it owns, Gilly Hicks, which has about 20 stores.
--Barnes & Noble: This bookseller will close one-third of its stores within the next year, or about 218 locations. Barnes & Noble has already closed its flagship New York City store.
--J.C. Penney: More economic trouble lies ahead for this iconic retailer; J.C. Penney plans to shut down 33 more stores in the coming months -- at a cost of 2,000 employees.
--Toys "R" Us: A New Jersey newspaper, The Record, reports that the toy seller will close 100 locations soon.
--Sweetbay Supermarket: This food chain will close all 17 stores it operates in the Tampa Bay area, according to The Herald Tribune. Many of them may reopen as Winn-Dixie locations, however. Sweetbay closed down 33 stores throughout Florida in 2013.
--Loehmann's: This entire chain of discount clothing stores in the New York City region has ceased physical retail operations. Loehmann's once operating 39 stores, according to The New York Times, and was considered an icon by many generations of New Yorkers.
--Sears: Yes, even legacy retailers are taking hits. Sears Holdings, according to industry analyst John Kernan in an interview with CNN, will likely shed another 500 stores this year. Sears Holdings owns both Sears and Kmart; Sears' flagship store in Chicago has already been shut down.
Quiznos: The small-sandwich chain has filed for bankruptcy, according to reports, and is liable to close many, if not most, of its 2,100 locations.
Sbarro: This fast-food chain serving pizza and Italian food operates mostly in malls, and, well, malls are dying, so the retailer's business is dying with them. Reports say Sbarro's will close 155 locations in the U.S. and Canada in the coming months -- or 20 percent of all stores.
Other retailers in trouble include Ruby Tuesday's, Red Lobster (which could be spun off into another brand altogether) and Ralphs, a subsidiary of food seller Kroger.
What's going on? Why so many closures?
One of the reasons has to do with the Internet; shopping for items online has been a growing phenomenon for the past decade, as evidenced by the growth of online retailers like Amazon and, ironically, Barnes & Noble.
Another has to do with a lack of economic growth in sectors of the economy that affect average Americans. While big banks and large corporations continue to do well on Wall Street, thanks in large part to government (read taxpayer) subsidies and corporatism, retailers at the mom-and-pop level have had a hard time, as higher energy prices, government policies (think Obamacare) and other anti-business factions work to reduce GDP.
It's only going to get worse from here.
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