U.S. Retail Closures Surpass Openings for First Time in 2024
By Isabelle Durso August 14, 2024 5:19 pm
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The pandemic may be over, but retailers are still feeling its impacts.
Retail store closings surpassed openings for the first time this year earlier this month, bucking trends from the last few years.
So far this year, 4,548 store closures have been announced nationwide compared to 4,426 openings — meaning a total of 122 stores have gone out of business this year, according to a report from Coresight Research released on Aug. 9. The news was first reported by CoStar News.
“Retailers are faced with a plethora of issues currently — some internal threats, some external,” Coresight CEO Deborah Weinswig told Commercial Observer. “Internally, some retailers have failed to deliver a true omnichannel solution for customers … Externally, consumers are being more considerate with their purchases.
“The combination of these issues has led to more bankruptcies, and on the whole they are all playing a role in why we are seeing a higher level of store closures than openings at this point this year,” Weinswig added.
Year to date, major retailers in the U.S. have announced a less than 0.1 percent change in store openings and a 31.4 percent increase in closures compared to the same period in 2023, the report found.
A major driver of the surge in closings has been furniture and homegoods seller Big Lots, according to the report. The discount retailer said in a July 31 filing with the U.S. Securities & Exchange Commission that it plans to close up to 315 locations by February 2025 — 289 of which Coresight predicted would close in 2024.
Big Lots currently operates 1,389 stores across the country and has marked more than 280 stores for closure on its website’s Store Locator page. This compares to the 35 to 40 locations Big Lots said it planned to close in the first quarter of 2024, the report showed.
Other retailers that have closed or plan to close stores this year include Fred Segal, Target, Party City, Publix, Sleep Number and JCPenney — the latter of which has closed 12 stores year-to-date. But Family Dollar and fashion retailer Rue21 saw the most losses at 533 and 543 confirmed store closures, respectively, since December 2023, according to Coresight.
On the other hand, discount chain Daiso is planning to open three new locations this year, and Gucci opened one store in Minnesota’s Mall of America, bringing its total number of outposts to over 100, according to the report. Dollar General saw the most success with 296 confirmed store openings this year.
The increase in store closures comes as more companies face bankruptcy in the aftermath of both the pandemic’s lockdowns and a historic rise in inflation, which led to steep drops in consumer spending in brick-and-mortar stores.
Just this week, LL Flooring filed for Chapter 11 bankruptcy and announced the closure of 94 of its stores in the process. Blink Fitness also filed for bankruptcy on Monday after reporting more than $280 million in debt, CO previously reported.
Isabelle Durso can be reached at idurso@commercialobserver.com.
