Modern sports venues find it insufficient to have game or race clocks that merely record time down to the second. Timers that capture elapsed or remaining time down to the tenth or hundredth of a second are now standard features, the numbers changing too fast for the eye to catch or the mind to comprehend.
We’re going to need a counter almost as fast as those to keep up with the number of retail stores closing in the U.S.
In the latest round: Payless Shoe Source, making a trip to bankruptcy court, announces plans to close 400 stores, including four in Washington. Abercrombie & Fitch plans to close 60 stores this year as leases expire. Aeropostale is in the midst of a store-closing program. So is Tailored Brands (you’d know its subsidiaries as Jos A. Bank and Men’s Wearhouse). So is Office Depot.
Ever been to a hunting, fishing and outdoor gear store called Gander Mountain? Its network of stores doesn’t extend farther west than Denver and El Paso. It has, you guessed it, filed for Chapter 11 bankruptcy court protection and is closing 32 stores.
How about electronics retailer hhgregg? None around here, and there may not be any around anywhere. The company went into Chapter 11 hoping to find a buyer and a reorganization plan; failing to accomplish either, the company is folding up shop, or more specifically all 220 shops.
And in an oh-by-the-way moment, Sears Holdings told The News Tribune last week that it had added the Kmart in Spanaway to locations under both brands being closed.
Each of those woe-beset retailers has a story for how it got to its present condition, and the sad tales differ by sector — consumer-electronics retailing in bricks-and-mortar stores has been in trouble for years, but others such as sporting goods and outdoor equipment are just now reaching the apex of consolidation and contraction.
All totaled — the thousands of employees losing their jobs, the millions of now-vacant square feet of space in malls and other retail developments, the lost income and investment that could well go into the billions of dollars, and what we’re seeing is the emergence of the biggest trend story in U.S. business in 2017.
Retail, frankly, may be in worse shape than manufacturing. The reasons have been percolating not as long as those plaguing manufacturing, but they are harder to fix.
Retail would still be in a pickle even without the Great Recession. What retail is going through is much more structural than economic. Yes, the country overbuilt retail space, and no, the recession that trimmed consumer spending didn’t help.
But retailers have been going out of business for decades without any help from the internet or Amazon. The size and pace of decline makes this slide different, as well as the suspicion that this is not a cycle and there’s no next-generation model of in-store, physical retail to reinvigorate the industry.
Retailers in our immediate region face additional pressures in addition to those posed by online shopping. Labor rates are going up; lease rates are going up. Online retailers typically don’t need as much of either. The next time you’re in a commercial district, scan the retail businesses there and mentally calculate how much merchandise they need to move just to keep the doors open, never mind cover all other operating expenses.
And yet … not everyone is waving the white flag on bricks-and-mortar stores. McLendon Hardware, the Renton-based chain of seven Puget Sound stores including Tacoma, Puyallup and Sumner, has been acquired by a Memphis, Tennessee, company that operates multiple local and regional hardware companies under their individual brands. One of the reasons for the deal, the family-owned company said in its announcement, is that “continued if not aggressive growth is essential. (The buyer) has the financial strength to sustain and expand our business in the Puget Sound Region and beyond.”
The hardware category has some quirks and features that give physical stores assistance in competing with online (bulky and heavy merchandise, or small individual items not economic to ship, the need for something right now in the middle of a repair project), but it’s not immune.
So who still believes in real-world retail? Amazon. We already know about its bookstores and grocery stores. Conjecture is rampant that Amazon might open stores in other categories, or buy an existing retailer.
The survivors — and there will be some — will be those that engender fierce loyalty in their customers, are better at constructing a value proposition for customers (beyond price and convenience) and get to whatever the new model of retailing is before Amazon does. Good luck, retailers of America — some of you will still be around, but you’re going to have to work even harder if you want to be.
Bill Virgin is editor and publisher of Washington Manufacturing Alert and Pacific Northwest Rail News. He can be reached at firstname.lastname@example.org.