Retail’s Historic Turning Point Is Happening Right Now; What to Do About It

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“How did you go bankrupt? Two ways. Gradually, then suddenly.”

Ernest Hemingway, The Sun Also Rises

When I think about what is now a crisis in bricks and mortar retailing, I recall an Ernest Hemingway quote in The Sun Also Rises. A character asks: “How did you go bankrupt?" The other character responds: "Two ways. Gradually, then suddenly.”

How did bricks and mortar retailing get into so much trouble? Two ways. Gradually and then suddenly.

The store closings, which started as a dribble, began to cascade in 2017. 15,000 stores have closed since that time with our own Toys R Us contributing 735.  Consider this April 10, Washington Post headline: "‘Retail apocalypse’ now: Analysts say 75,000 more U.S. stores could be doomed." The use of the term "apocalypse" seems a bit hyperbolic until you read this paragraph from Abha Bhattarai's article:

An estimated 75,000 stores that sell clothing, electronics and furniture will close by 2026, when online shopping is expected to make up 25 percent of retail sales, according to UBS. Roughly 16 percent of overall sales are made online.

 

One thought

  1. Retail Apocalypse for who?
    1: The US has been ‘over’ stored, with more retail square footage per capita by far than any other nation. Even with all the closures we still are.
    2: I mean I do feel bad for all those buggy whip manufacturers, but wow have you seen how fast those new-fangled automobiles go?!?
    3: It’s tough competing with Walmart.com and Target.com and Amazon.com, but hey, at least I don’t have Toy’s R Us, Kaybee, and Radio Shack to kick me around anymore☺
    4: As an etailer with multiple toy stores online only, brick and mortar’s closures mean more sales for me. My kids gotta eat too.
    The bottom line is that in 2019 it’s no longer an ‘Us’ vs. ‘Them’ world anymore. Almost every brick and mortar toy seller has an online presence, including most of the toy manufacturers. The American Retail / Etail industry, including it’s ‘Toy’ subset is slicing away some fat. We’ll all be healthier for it in the end.

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