News • 28.08.2019

Five retailers are opening stores for every retailer closing stores

New report by IHL Group debunks the retail apocalypse narrative

Several people cutting through a red ribbon; copyright: panthermedia.net/ronstik...
Source: panthermedia.net/ronstik

More than five retail chains are opening stores for every retailer that is closing stores in 2019, according to new research from IHL Group. This is up from 3.7 in 2018. The company also reports that the number of chains adding stores in 2019 has increased 56 percent, while the number of closing stores has decreased by 66 percent in the last year.

The report “Retail Renaissance – True Story of Store Openings/Closings” reviewed 1,660 retail chains with 50 or more locations in the United States across nine industry segments. For each retailer, the company measured the total store counts at the end of 2016, 2017, 2018, and plans for 2019 year-end based on company filings and statements. The net total increase or decrease in their store count was noted and that data was tallied across companies.

IHL reports that fewer retailers make up the bulk of closures in 2019. In 2018, 20 chains represented 52 percent of all stores closed. In 2019, the 20 announcing the most closures represent 75 percent of all closures.

“U.S. retail has increased 565 billion dollars in sales since January of 2017, fed not just by online sales growth but net store sales growth,” said Lee Holman, VP of Research for IHL Group. “Clearly there is significant pressure in apparel and department stores, however, in every single retail segment there are more chains that are expanding their number of stores than closing stores.”

Since 2017, apparel and department store chains have seen the net closure of 9,651 stores. During this same period, all other segments represented 18,226 net new openings. Additional findings include the following:

64 percent of retailers are increasing the number of stores in 2019, 12 percent are decreasing and 24 percent report no change in store counts. This compares to 2018 with 41 percent increasing store counts, 37 percent decreasing and 22 percent with no change.

  • For every chain closing stores, +5.2 chains are opening stores.
  • 2018 was a peak year in the number of chains closing stores with 37 percent reducing their store counts. This number has dropped to 12 percent of total retailers in 2019.
  • Specifically, these ratios by segments include the following:
  • Food/Drug/Convenience/Mass Merchants: +9.5
  • Apparel, Hard Goods, Department Stores: +3.7
  • Restaurants, Fast Food, Table Service: +6.3 chains opening vs closing stores

According to the research, the two primary characteristics of chains closing the most stores has been too much debt and rapid overexpansion driven by historically low interest rates for the last 10 years. Lack of innovation and short-sighted private equity has also played a significant role in many of the chains.

The IHL report notes that it is normal and healthy for chains to be both opening new stores and closing non-performing stores. It is the net change overall (along with other measures) that reveals the health of the company and the industry. Seven of the nine segments have a net increase in stores for 2019. Only two industries, apparel and department stores, show a net decline in stores among all the retailers in the segment.

The research report is available immediately for no cost.

Source: IHL Group

related articles:

popular articles:

Thumbnail-Photo: Retail problems: We’ve got the premises but where are the customers?...
04.11.2019   #customer satisfaction #pos marketing

Retail problems: We’ve got the premises but where are the customers?

The Trendforum Retail 2019 highlighted multi-use retail developments

At the Trendforum Retail on October 9 &10, 2019, in Schwalbach near Frankfurt am Main, speakers and visitors examined how brick and mortar retailers can attract, keep and excite customers.Interested event participants were given a tour by Marcus ...

Thumbnail-Photo: Returns costing retailers billions each year...
09.01.2020   #online trading #dispatch

Returns costing retailers billions each year

B-Stock reveals the most returned Christmas gifts

The number of products being sent back on National Returns Day (2nd January) were expected to be 72 percent higher than the average day in December according to the Royal Mail - contributing massively to the yearly total of £60 billion worth ...

Thumbnail-Photo: 75 % of millennials abandon in-store purchases...
14.11.2019   #customer satisfaction #brick and mortar retail

75 % of millennials abandon in-store purchases

Zebra study: out-of-stocks drive shoppers to online

Zebra Technologies Corporation today revealed the results of its 12th annual Global Shopper Study, the industry’s only market tracker that analyzes the attitudinal behavior of shoppers, retail associates and retail executives and examines the ...

Thumbnail-Photo: retail trends 1/2020 focus EuroShop 2020
05.02.2020   #digital signage #lighting systems

retail trends 1/2020 focus "EuroShop 2020"

The current issue with all trends around retail

Would you like to find out about the latest retail trends in technology, marketing, lighting, store design and logistics, browsing page by page? We would be happy to send you our current print edition retail trends on the focus "EuroShop ...

Thumbnail-Photo: The favour of the hour
01.01.2020   #sustainability #refrigeration cabinets

The favour of the hour

Energy efficiency and environmental awareness in retail

The current events in the frozen food industry show: Energy efficiency and environmental awareness are becoming increasingly important. Old refrigerants have to be replaced in freezers and retail has to act.The demands placed on food retailers are ...

Thumbnail-Photo: Professional Development Guide – newly updated...
22.01.2020   #security #digital marketing

Professional Development Guide – newly updated

Integrated Systems Europe (ISE) 2020

Just published, the Second Edition of the Professional Development Guide contains full details of the learning and development opportunities at ISE 2020. Full listings of manufacturer demo and training sessions have been added, along with updates to ...

Thumbnail-Photo: Sensory experiences increase in-store sales
29.11.2019   #digital signage #pos marketing

Sensory experiences increase in-store sales

New Research from Mood Media confirms that sensory marketing has a positive emotional, cognitive and behavioral impact on shoppers

Mood Media, the world’s leading in-store media solutions company dedicated to elevating the Customer Experience, today released a new quantitative behavioral marketing study, “Quantifying the Impact of Sensory Marketing,” which ...

Thumbnail-Photo: What you want is what you need!
07.02.2020   #e-commerce #customer satisfaction

What you want is what you need!

Retail experience – What shoppers want and how to implement

E-commerce has significantly changed how people shop, and push retailers to rethink the role of their stores. With change being a constant and continually accelerating, there is truly only one way to learn what shoppers want and expect their ...

Thumbnail-Photo: E-commerce Berlin Expo 2020 - first speakers announced!...
19.12.2019   #e-commerce #retail

E-commerce Berlin Expo 2020 - first speakers announced!

Save the date: the 13th of February of 2020, STATION-Berlin

This is where e-commerce insights combine with business knowledge and one of a kind networking, during the fifth edition on E-commerce Berlin Expo. The first speakers have already been announced - and saying that they are good and solid, is a real ...

Thumbnail-Photo: First national Use Your Gift Card Day on January 18th...
06.01.2020   #event #sales promotion

First national Use Your Gift Card Day on January 18th

$1 billion in gift cards go unused each year

A new shopping holiday will debut on January 18th to encourage people to get out and use their holiday gift cards before they become part of the 1 billion dollars in gift cards that go unused each year.   National retailers and restaurants are ...

Supplier

APG Cash Drawer
APG Cash Drawer
4 The Drove
BN9 0LA Newhaven
VKF Renzel GmbH
VKF Renzel GmbH
Im Geer 15
46419 Isselburg
Mood Media GmbH
Mood Media GmbH
Wandalenweg 30
20097 Hamburg
iXtenso - Magazin für den Einzelhandel
iXtenso - Magazin für den Einzelhandel
Celsiusstraße 43
53125 Bonn
POS TUNING Udo Voßhenrich GmbH & Co KG
POS TUNING Udo Voßhenrich GmbH & Co KG
Am Zubringer 8
32107 Bad Salzuflen