2023 has not been a good year for various companies in the United States in terms of financial gains.
Due to losses, increase in online shopping, high inflation among other reasons, physical stores have closed down. The event was classified as a retail crisis or apocalypse.
There is also a trend for some companies to increase online sales and close stores in this new year.
This will give more opportunities to retail companies, while stores will be hit harder by the lack of customers.
Walmart, TJ Maxx and Marshalls, Dollar Tree, RiteAid, CVS, Walgreens, etc. announced the closing of some of their locations.
High expenses for rent, salaries and others as well as thefts in businesses are factors that influence the closure of stores. This measure is due to poor business performance.
Walmart, the retail giant, began closing in several states in 2023, with others to join in 2024.
TJ Maxx and Marshalls stores plan to close three locations in January 2024: two in New York and one in Illinois. Its workers will be transferred to nearby stores.
Another popular chain for its discounts is Dollar Tree Inc. Since last year it has announced the definitive closure of some of its underperforming stores due to inflation in the country.
The pharmaceutical industry has also been affected. After filing for bankruptcy, Ritual Aid announced the closing of 154 stores. Meanwhile; CVS announced a few years ago that it would close 900 branches between 2022 and 2024.
Walgreens is the second largest pharmacy chain. In the first half of 2023, it reported an increase of 8.6% in retail sales. However, it will close its doors permanently after declaring bankruptcy.
Some effects of the retail crisis
This crisis has led to many challenges and changes in business models. Very beneficial and attractive for retailers facing financial difficulties.
It is an opportunity to improve the size of the commercial network, reduce costs and reduce costs to avoid bankruptcy.
But, it has had a negative impact on others as well. For workers, changes in unemployment and other dependencies. For clients, traveling to other more distant places to satisfy their needs such as medicines.
This phenomenon is expected to increase continuously in the coming years. About 50,000 US stores will close by 2027, according to investment bank UBS.
Branch closure in the United States
