To be clear, 2022 Christmas sales increased over the previous year; it’s simply that expectations were set expecting an even larger increase following two years of the pandemic.
As a result, nearly 800 stores are set to close throughout the country by 2023.
Bed Bath & Beyond, Walmart, Gap, and Party City are just a few of the huge brands that will be scaling back. Bath & Beyond, which barely avoided bankruptcy earlier this month, is the greatest loss, intending to reduce its store count to 480 from over 1,500.
At least 416 stores, as well as all 65 of its Canadian sites, have been earmarked for closure. In California alone, 35 will close.
I don’t think BB&B’s removal of My Pillow creator Mike Lindell is the root of all their problems, but it didn’t help.
Tuesday Morning, a homegoods retailer, will liquidate 265 locations as it battles to escape bankruptcy procedures. California will be most struck once again, with 30 businesses closing their doors.
Macy’s, Big Lots, JCPenney, and even Amazon Fresh have announced plans to close stores.
What exactly is going on here? CNBC explains:
“For merchants, the outcomes of the holiday shopping season underscore the problems that lie ahead. When Consumers continue to pay greater costs for groceries, housing, and other necessities month after month, they accumulate credit card debt, deplete savings, and have less funds for discretionary expenditure.”
“Furthermore, shops are following years of record spending. During the Covid outbreak, People utilized stimulus checks to combat boredom by purchasing loungewear, kitchen supplies, throw pillows, home entertainment systems, and other items.”
Party City, the well-known entertainment supplier company, has declared bankruptcy and is auctioning off several of its leases.
Party City Holdco Inc. is trying to reduce its retail network as part of an accelerated financial reorganization, one month after filing for Chapter 11 bankruptcy protection.
The Woodcliff Lake-based operator of 800-plus shops said in a Feb. 16 bankruptcy court filing that it is working with A&G Real Estate Partners to auction off leases for 12 failing sites in six states. According to A&G, further lease auctions will take place in the following weeks, with the final number of closings depending on the success of ongoing talks with landlords.
Regrettably, this is not a new phenomenon. CVS, Kroger, Nordstrom, Rite-Aid, and Best Buy have also been discreetly closing locations in recent years. Another aspect is that many stores are closing simply because they are unsafe to operate in, as lenient legislation and vigilant prosecutors have transformed numerous establishments into virtual free-for-alls for organized shoplifters.
Is the era of physical shopping coming to an end? Several of these factors were already in place before the pandemic; the COVID disaster just exacerbated the destiny of brick-and-mortar establishments and effectively delivered billions of dollars in sales to internet merchants like Amazon while people were trapped at home.
Yet, economies move in waves, with peaks and dips. I don’t believe we’ve seen the death of malls and physical businesses yet. Humans are social creatures, and the excitement of online buying is beginning to wear off for many. They want to see the things, touch the items, and talk to people.
As a rare positive indication, January retail sales increased dramatically as shoppers took advantage of after-Christmas sales. If history is any indicator, Biden’s inflation will eventually subside and everything will return to normal.
Having said that, former President Barack Obama once warned of Biden, “Don’t underestimate Joe’s capacity to f*** things up.”
Comments are closed.