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Economic Recovery? 13 Of The Biggest Retailers In America Are Closing Down Stores
26
February, 2016
Barack
Obama recently stated that anyone that is claiming that America’s
economy is in decline is “peddling
fiction“.
Well, if
the economy is in such great shape, why are major retailers shutting
down hundreds of stores all over the country?
Last
month, I wrote about the “retail
apocalypse”
that is sweeping the nation, but since then it has gotten even
worse. Closing stores has become the “hot new trend” in the
retail world, and “space available” signs are going up in mall
windows all over the United States. Barack
Obama can continue huffing and puffing about how well the middle
class is doing all he wants, but the truth is that the cold, hard
numbers that retailers are reporting tell an entirely different
story.
Earlier
today, Sears Chairman Eddie Lampert released a letter to shareholders
that was filled with all kinds of bad news. In this letter, he
blamed the horrible results that Sears has been experiencing lately
on “tectonic
shifts” in consumer spending…
In a letter to shareholders on Thursday, Lampert said the impact of “tectonic shifts” in consumer spending has spread more broadly in the last year to retailers “that had previously proven to be relatively immune to such shifts.”
“Walmart, Nordstrom, Macy’s, Staples, Whole Foods and many others have felt the impact of disruptive changes from online competition and new business models,” Lampert wrote.
And
it is very true – Sears is doing horribly, but they are far from
alone. The
following are 13 major retailers that are closing down stores…
#1 Sears
lost 580
million dollars in
the fourth quarter of 2015 alone, and they are scheduled to close at
least 50 more “unprofitable
stores”
by the end of this year.
#2 It
is being reported that Sports Authority will file for bankruptcy in
March.
Some news reports have indicated that around 200 stores may close,
but at this point it is not known how many of their 450 stores will
be able to stay open.
#3 For
decades, Kohl’s has been growing aggressively, but now it plans to
shutter 18
stores in
2016.
#5 Best
Buy closed 30
stores last
year, and it says that more store closings are likely in the months
to come.
#9 J.C.
Penney will be permanently shutting down 47
more stores after
closing a total of 40
stores in
2015.
#10 Macy’s
has decided that it needs to shutter 36
stores and
lay off approximately
2,500 employees.
These
store closings can be particularly cruel for small towns. Just
consider the impact that Wal-Mart has had on the little town
of Oriental,
North Carolina…
The Town’n Country grocery in Oriental, North Carolina, a local fixture for 44 years, closed its doors in October after a Wal-Mart store opened for business. Now, three months later — and less than two years after Wal-Mart arrived — the retail giant is pulling up stakes, leaving the community with no grocery store and no pharmacy.
Though mom-and-pop stores have steadily disappeared across the American landscape over the past three decades as the mega chain methodically expanded, there was at least always a Wal-Mart left behind to replace them. Now the Wal-Marts are disappearing, too.
Of
course there are many factors involved in this ongoing retail
apocalypse.
Competition from online retailers is becoming more intense, and
consumer spending patterns are rapidly changing.
But
in the end, the truth is that you can’t get blood out of a rock.
The middle class in America is
shrinking,
and there just isn’t as much discretionary spending going on as
there used to be.
And
now that we have entered a
new economic downturn,
many retailers are finding that there are some
local communities that can no longer support their stores.
The following comes from
CNBC…
Though the shift to online shopping is no doubt playing a role in lighter foot traffic at malls, there’s more to their changing economics than the rise of Amazon. Changing demographics in a town are another reason a shopping center could struggle or fail — for example, if massive layoffs in a particular industry cause people to move away to find employment.
“A lot of people want to try and tie it to the Internet or ‘that’s not cool,’ or teens don’t like it,” Jesse Tron, a spokesman for industry trade group International Council of Shopping Centers, told CNBC last year. “It’s hard to support large-format retail in those suburban areas when people are trying to just pay their mortgage.”
In
order to have a thriving middle class, we need good paying middle
class jobs. Unfortunately, our economy has been bleeding those
kinds of jobs quite rapidly.
For example, Halliburton just announced that it is eliminating 5,000
more jobs after
getting rid of 4,000 workers at the end of last year.
During
the Obama years, good paying middle class jobs have been getting
replaced by low paying service jobs. At this point, 51 percent
of all American workers make
less than $30,000 a year.
And
there is no way that you can support a middle class family with
children on $30,000 a year.
We
have an economy that is in the process of failing. We
can see it in the explosion of subprime
auto loans that are going bad,
we can see it in the hundreds of retail stores that are shutting
down, and we can see it in the tens of thousands of good paying
energy jobs that are being lost.
During
the Obama years, interest rates have been pushed to the floor, the
Federal Reserve has created trillions of dollars out of thin air, and
the size of our national debt is getting close to doubling. Despite
all of those desperate measures, our economy continues to crumble.
We
stole from the future to try to paper over our failures and it didn’t
work.
Now an economic downturn that will ultimately turn out to be even
worse than the “Great Recession” of 2008 and 2009 has begun, and
our leaders have absolutely no idea how to fix things.
I
wish I had better news to report, but I don’t. Get
prepared now, because very rough times are head.
And Down-Under
Dick
Smith to close all 363 stores with nearly 3,000 staff to lose jobs
Receiver
Ferrier Hodgson says it was unable to find a buyer for the troubled
retailer, which went into receivership in January with debts of about
$400m
26
February, 2016
Electronics
retailer Dick Smith will close its 363 Australian and New Zealand
stores within eight weeks, putting 2,890 staff out of a job.
Receiver
Ferrier Hodgson says it has not managed to find a buyer for the
troubled retailer, which went into receivership in January with debts
of about $400m.
“While
we received a significant number of expressions of interest from
local and overseas parties, unfortunately the sale process has not
resulted in any acceptable offers for the group as a whole or for
Australia or New Zealand as standalone businesses,” receiver James
Stewart said.
“The
offers were either significantly below liquidation values or highly
conditional or both.”
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