Retail and mall shopping ain’t what they used to be

The US retail sector may be at the top, and with changing demographics and online sales competition, the once popular mall and department stores can become very much like the species that some once they were dominant from our pale blue point. Like dinosaurs, the department store model looks like it will soon be ancient history. Let’s talk, as there is more evidence than not to support this prediction.

The Kansas City Business Journal had an article titled: “Study: Department Stores Must Prune Mall Space to Flourish Again” published on April 25, 2016, which read: “A real estate research firm says Department stores must close hundreds of sites – about 20 percent of all anchor space – in US shopping malls to regain their decade-old productivity, The Wall Street Journal reports. For example, Sears Holdings Corp It would have to close 300 stores, or 43 percent of its total, to achieve sales per square foot it had in 2006, according to the Green Street Advisors study.

Meanwhile, The Louisville Business Journal published a revealing article recently titled, “Major Retailer Plans to Close All Its Louisville Area Stores Except One”, published on April 22, 2016, which read: “Kmart Plans to Close All But One Its Louisville-area stores this summer. The retail chain’s parent company, Sears Holding Corp., announced Thursday that a total of 78 Kmart and Sears stores will close, and that number includes four Kmart stores in the Louisville area. reports WDRB TV. “

And what exactly did that Wall Street Journal article say on top of all this? Well, read it for yourself; Suzanne Kapner’s “Glut Plagues Department Stores” and the research firm’s recommendation that in the US there must be at least 800 prime tenant department stores closing for profitability to stabilize, that would be roughly one fifth of all department stores. You can say; Oh! For the retail sector, I think this is what all the retail equity fund managers are collectively saying now, and one would have to ask; Why? Why is this happening?

Well, consider the lush growth over the years and the rise in online sales, the expansion of Wal-Mart’s department stores, and the declining spending income of Americans, due to college tuition costs. , health insurance and rising costs of things that were not known before. , but now modern life necessities like: smartphones, cable TV, etc. Wages and salaries on average have stagnated and, along with moderate to zero inflation, have stagnated in growth. The world is changing and the world of retail must adapt or die; there is no longer a choice about it. Please think about this.