"Dixie Square Mall in Harvey, Illinois" by Brian Ulrich.
If the Great Recession is winding down and job numbers are up, why does traditional retail seem to be in its death throes? Several factors are dragging down the mall experience, including changes in how people buy goods, an enormous surplus of retail square footage, and a general suburban exodus. Online purchases, including those made via tablet and smartphone, make up 13% of all retail sales and that number is growing. For ease of browsing, brick-and-mortar stores cannot compete with online retailers. There is also an overabundance of choice when it comes to these stores, with 50 square feet of retail space for every man, woman and child in the U.S. Growth of square footage has simply outpaced demand. And while consumers are shifting their shopping experiences from the social to the individual, there is also a shift taking place in where these shoppers live. More young consumers are choosing to reside in big cities, ringing a death knell for the sprawling indoor suburban mall.
But can't teenagers be counted on to prop up flagging interest in brick-and-mortar shopping? The short answer is "No." Teen retailers have been especially hard hit with 1990s and Aughts powerhouse Delia's closing it doors and filing for bankruptcy in early December. Aeropostale closed 75 stores over the holidays with another 50-75 locations on the chopping block this year. Rival Abercrombie's longtime CEO Mike Jeffries recently stepped down after being sued by company shareholders for poor governance in the face of lagging sales. Teens are flocking to fast-fashion brands H&M, Forever 21 and Zara whose lightning-fast distribution networks are able to deliver new designs to stores within a matter of weeks. These retailers are often choosing to locate in larger cities or newer open-air "lifestyle centers."
Bankruptcy expert Chuck Tatelbaum sums up the recent retail shake-out: “Because of the changes in buying habits of U.S. consumers, as a result of the continuing hesitancy to spend, the 2014 holiday season was not sufficiently successful for many retailers that have either over expanded, fell out of favor or had insufficient capital and merchandise.” In other words, today's shoppers are online, "showrooming," and creating a new frontier for retail.
All 2015 Store Closings - Stores Closed by U.S. Retail Industry Chains [About Money]
Retailers are closing up shop. Here's why... [CNBC Retail]
Retail Earthquake: All These Big-Name Stores Closing [WND Weekly]
A 'tsunami' of store closings expected to hit retail [CNBC Retail]