The comfort of online shopping has led to a movement away from shopping malls thus affecting physical retail stores for more than a decade. Also, the advent of the COVID-19 pandemic dealt a deadly blow to the structure of several American companies and it’s no secret that many retailers and employees were mostly affected in 2020.
While some companies reacted to the strain by downsizing and closing their worst-performing stores, others maintained complete closure. However, a few stores decided to reinvent themselves solely as online retailers, though not all have managed to achieve that goal just yet. Retail analysts believe that the plummeting is not over and the closure trend will continue as more consumers resort to online shopping to fulfill their retail needs.
A list of stores that have been hit by the wave of closure
The brand which has been around since 1920 and is known for its casual wear, footwear, travel, and camping gear is closing down some of its stores. The Toronto and Saratoga springs outlet is up for closure by January 28.
The main reason behind the shutdown of the company is relatively a secret.
After almost 60 years of business, the discount department store filed for Chapter 11 bankruptcy protection in 2022 and is shutting down all of its remaining 13 stores. The decision to fold up came from the failure of the company’s insurance providers to pay roughly $175 million due in policies to protect Century 21 from the losses it suffered throughout the coronavirus pandemic.
The company’s co-CEO, Raymond Gindi revealed the shocking event in a statement to the press. “While insurance money helped us to rebuild after suffering the devastating impact of 9/11,” he said. “We now have no viable alternative but to begin the closure of our beloved family business because our insurers, to whom we have paid significant premiums every year for protection against unforeseen circumstances like we are experiencing today, have turned their backs on us at this most critical time.”
Another popular American department store is attempting to salvage all that it can as the onslaught of online shopping continues. Macy’s announced a downsizing of a fifth of its stores and 20,000 employees over three years.
The CEO, Jeff Gennette revealed in a statement that the store’s action is aimed at an increase in productivity. “We are taking the organization through significant structural change to lower costs, bring teams closer together, and reduce duplicative work.”
The historical department store which has existed for about 120 years isn’t spared in the current economic crisis. JCPenney has also been forced to close some of its outlets after declaring bankruptcy in 2020. CNN Business reported that JCPenney missed debt payments and is nearly $4 billion in debt and the CEO, Jill Soltau confirmed it in a press release, “The closure of our stores due to the pandemic necessitated a more fulsome review to include the elimination of outstanding debt.” The company has the intention of shutting down a total of 242 stores.
However, at the brink of its collapse, Mall owners Simon Property Group and Brookfield Asset Management Inc. have acquired the company thus reinventing it as a private company.