ONLY 2,400 BIG BOX STORES TO CLOSE IN NEXT FEW YEARS

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Posted on 30th January 2013 by Administrator in Economy |Politics |Social Issues

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Nothing like a little reality on a Wednesday afternoon. Below is a list of the worst of the worst retailers in the U.S. Hysterically, there are multiple articles about JC Penney this morning and the surge in their stock price yesterday because their dumbass CEO has announced a major change in strategy. Drum roll please. He is going back to having fake sales. The idiots who call themselves financial analysts immediately expounded upon the brilliance of this move. After losing $1 billion of business in one year, this will surely turn the ship back on course.

So solly. The list below, along with the three other failed retailers – Gamestop, Office Max and Radio Shack will be closing thousands of stores in the near future. Just think of all the benefits this will provide. More ghost malls across America. It will do wonders for the Space Available sign manufacturers. Maybe some new retail concepts can gain a foothold – Soup Kitchens R Us, Used Body Parts Thrift Store, or a cafe catering to senior citizens with your choice of cat or dog food. 

It should really test the accounting fraud skills of mall owners, property developers, and our friendly Wall Street bankers as rental income dries up and loan payments on vacant malls become a little challenging. I’m sure Bernanke can convince the FASB to let the banks convert all commercial loans to balloon payment loans with a 50 year term. Therefore, all will be well. No need for cashflow or tenants. I should work for the government.

There should be some great going out of business sales. I’m looking forward to it.

Retailers That Will Close the Most Stores

by | January 29, 2013 at 1:24 PM | Economy, General, Shopping

(AP Photo/Dave Martin)

By Douglas A. McIntyre, Samuel Weigley, Alexander E.M. Hess and Michael B. Sauter, 24/7 Wall St.

It is the time of year again, when America’s largest retailers release those  critical holiday season figures and disclose their annual sales. A review of  these numbers tells us a great deal about how most of the companies will do in  the upcoming year. And while successful retailers in 2012 may add stores this  year, those that have performed very poorly may have to cut locations during  2013 to improve margins or reverse losses.

For many retailers, the sales situation is so bad that it is not a question  of whether they will cut stores, but when and how many. Most recently, Barnes & Noble Inc. (NYSE:  BKS) decided it had too many stores to maintain profits. Its CEO recently  said he plans to close as many as a third of the company’s locations.

Several of America’s largest retailers have been battered for years. Most  have been undermined by a combination of e-commerce competition, often from  Amazon.com Inc. (NASDAQ:  AMZN) and more successful retailers in the same areas. Borders and Circuit  City are two of the best examples of retailers that were destroyed by larger  bricks-and-mortar competition and consumers transitioning to online shopping.  These large, badly damaged retailers could not possibly keep their stores  open.

RELATED: The Most Hated Companies in America

24/7 Wall St. reviewed the weakest large U.S. retailers and picked those that  likely will not be profitable next year if they keep their current location  counts. 24/7 analyzed the retailers’ store counts, recent financial data, online presences, prospects against direct  competitors and precedents set by other large retailers that have downsized by  shuttering locations. We then forecast how many stores each retailer will have  to close this year to sharply increase its prospects financially, even if some  of those location closings do not occur for several years. These forecasts were  based on drops in same-store sales, drops in revenue, a review of direct  competitors, Internet sales and the size of cuts at retailers  in the same sector, if those were available.

5. Barnes & Noble
> Forecast store closings: 190 to  240, per company comments
> Number of U.S. stores: 689
>  One-year stock performance: 8.95%

The move by customers away from print books toward digital books has hurt  Barnes & Noble Inc. (NYSE:  BKS). Same-store sales during the nine-week holiday season fell by 8.2%  year-over-year. The bookseller has tried to offset the declines in physical book  sales with its Nook e-book reader device, but sales of that device fell 13%  compared to the previous year. The company already has begun cutting down  the number of its stores in the past several years. In a recent interview with  the Wall Street Journal, the head of the retail group at Barnes & Noble said  he expected the company to have just 450 to 500 retail stores in 10 years.

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4. Office Depot
> Forecast store closings: 125 to 150
> Number of U.S. stores: 1,114
> One-year stock  performance: 50.7%

Office Depot Inc.’s (NYSE:  ODP) troubles date back to years of competition against OfficeMax Inc. (NYSE:  OMX) and Staples Inc. (NASDAQ:  SPLS), as well as big-box retailers like Walmart. All three stores were  dealt a blow from reduced business activity during the recession, as well as  increased popularity of online retailers such as Amazon. The company’s North  American division reported an operating loss of $21 million in the third quarter  of 2012. Office Depot plans to relocate or downsize as many as 500 locations and  close at least 20 stores. In the third quarter of 2012, the company closed four  stores in the United States, and same-store sales were down by 4%  year-over-year.

3. J.C. Penney
> Forecast store closings: 300 to 350
> Number of U.S. stores: 1,100
> One-year stock performance: -53.6%

J.C. Penney has gone through a rough stretch recently. In the most recent  quarter, same-store sales fell by 26.1% compared to the year-ago period. Even  Internet sales, which are increasing significantly across the retail sector,  have taken a turn for the worst, falling 37.3% in the third quarter, compared to  the prior year. J.C. Penney sales have taken a turn for the worst since former Apple Inc. (NASDAQ:  AAPL) retail chief Ron Johnson took the helm at the company. Johnson’s plan,  among others, has been to wean customers off of heavy discounting and simply  give customers low prices. However, retail strategists and analysts have argued  that Johnson’s plans have created confusion among customers and has been a  further setback to any potential turnaround.

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2. Sears Holding Corp.
> Forecast store closings: Kmart  175 to 225, Sears 100 to 125
> Number of U.S. stores: 2,118
> One-year stock performance: 8.8%

Both Sears and Kmart have been going down the tubes for a long-time, steadily  losing their middle-income shoppers to retailers such as Wal-Mart Stores Inc.  (NYSE:  WMT) and Target Corp. (NYSE:  TGT). Sears Holdings Corp.’s (NASDAQ:  SHLD) same-store sales have declined for six years. In the most recent year,  same-store sales at the namesake franchise fell by 1.6% and at Kmart by 3.7%,  compared to the year-ago period. The company is already in the process of  downsizing its brick-and-mortar presence. In 2012, Sears announced it was  shutting 172 stores. CEO Lou D’Ambrosio is leaving the company in February, to  be replaced by chairman and hedge-fund manager Edward Lampert. Lampert has  minimal operating experience in retail management.

1. Best Buy
> Forecast store closings: 200 to 250
> Number of U.S. stores:1,056
> One-year stock performance: -36.8%

The holiday season was rough for Best Buy Co. Inc. (NYSE:  BBY). Same-store sales declined by 1.4% year-over-year, with international  stores posting a 6.4% decline while U.S. same-store sales were flat.  Companywide, the electronics retailer reported that holiday revenue had declined  to $12.8 billion from $12.9 billion the year before. In the most recent  completed quarter, during which same-store sales declined 4.3%, the company  reported a loss of $0.04 per share. Best Buy has been plagued by customers “showrooming” — looking at products in the store and then purchasing them online — in recent years. Speculation persists  that former chairman and founder Richard Schulze may buy out the company.

To see the full list, visit 24/7 Wall St.

11 Comments
  1. ThePessimisticChemist says:

    Barnes and Noble? Man, its getting harder and harder to find a book store these days.

    30th January 2013 at 2:21 pm

  2. JIMSKI says:

    I just wish every last title was available for the Nook. If so I would never need to go to B&N.

    30th January 2013 at 2:32 pm

  3. PlatoPlubius says:

    @ TPC

    It’s funny you say that cuz my lady and I were having a conversation yesterday about some of my fears related to the disappearance of printed documents.

    I happened to catch something on t.v. about the Manhattan Project and it got me thinking about the Montauk project on New York’s Long Island back in the 40s. This experiment supposedly dealt with time travel…..If there were such a device would we even know it was being used? Theoretically I know of only a few ways to know if it were being used. Primarily by comparing genuine written documents retained from the past with what is being taught and most commonly accepted as historical non-fiction today.

    With the implementation of digital books and the push to get an IPAD in every classroom to save the “trees” of course, history can be constantly updated and refreshed in the near future.

    Digital Age = A Historical Revisionist’s Wet Dream

    30th January 2013 at 2:35 pm

  4. Clownbucks says:

    “Dems Tout Claim: ‘Best-Looking Contraction in U.S. GDP You’ll Ever See’” http://www.weeklystandard.com/blogs/dems-tout-claim-best-looking-contraction-us-gdp-youll-ever-see_698863.html

    Damn. I’ve gone blind.

    30th January 2013 at 2:37 pm

  5. PlatoPlubius says:

    For those who are unaware of the Montauk experiment, it was the continuation of the Philadelphia Experiment

    30th January 2013 at 2:38 pm

  6. PlatoPlubius says:

    All it takes is ONE GENERATION….Perhaps the Millenials eh? By then most of the baby boomers will have died off….and the majority of Gen X is all for the advances in technology to make their lives resemble the Jetson’s or Star Trek: The Next Generation that they grew up exposed to.

    30th January 2013 at 2:41 pm

  7. DaveL says:

    This is good news for America’s future. Nancy Pelosi says that unemployment checks add $1.69 to the economy for every dollar handed out. By the time all these stores are closed the fucking economy should be booming so much they can reopen.

    30th January 2013 at 10:42 pm

  8. Novista says:

    PlatoPlubius

    Funny thing — all the history I learned in high school turns out to be lies.

    But revisionism is now, not history — look at the hourly changing story of “bin Laden” or “Newtown School” …

    30th January 2013 at 11:51 pm

  9. OF says:

    From Monty…. is only part of the article…

    “There Will Be No Recovery”
    economy, Favorites Tagged with: Fourth Turning, Howe, Quinn, Strauss
    Jan
    23
    2013

    “There will be no recovery.” This line is one I use often. I am sure readers are tiring of it. Yet these five words, I believe, accurately summarize our future.

    No time frame is reflected in the statement, but a “long one” is implied. Obviously there will be a recovery at some point, just not within a time frame considered normal. I began using these words long before the declared recovery in June 2009. The statement certainly has been correct since before then and until today. The declared end of the recession in 2009 was then and is especially in hindsight, ill-advised. One can imagine it as Orwellian propaganda, but not economics. There has been no recovery and many economic statistics have deteriorated in this declared period of recovery.

    Will there ever be a recovery? Sure, but it will not come before a cataclysm. The cataclysm will shake the economy, financial markets and perhaps society itself in a manner never seen in this country. A cleansing, a catharsis, a complete purging of the economy, financial markets and government must occur before healing can commence. The cancer eating our essence must be excised. The process will be neither quick nor pleasant, but it is a precondition to true recovery.

    Jim Quinn published a new piece that touches on this topic. Mr. Quinn generally places his analysis into the context of The Fourth Turning by Strauss and Howe. While I have never been enamored of cycle theories of history, Strauss and Howe have managed to tie causation back to individual behavior via a sort of collective, generational memory whereby history “repeats” four clearly defined twenty-year cycles. According to their calculations, we are in the fourth turning, the last of the twenty-year periods, This phase is the destructive one that leads to a re-birth and renewal of the eighty-year cycle……..

    31st January 2013 at 3:11 am

  10. Eeners says:

    a coworker shared this with me. I find it interesting that these former giants don’t ever check out their competition, poach their staff, replicate their ideas.

    Examples- Target vs Kmart, they are doing something, with even slightly higher prices. what is it?
    Sears/JcP vs. Kohl’s – again what are they doing? Kohl’s brings in designers, has monthly coupons for card holders, etc

    Best Buy – I feel bad for them…especially if they help people that “test it out” and then go home and order it on Amazon. I never do that, that is crappy. I will tell you, I live in ILLinois (whole other topic there), and am a loyal customer of Abt. A local competitor to Best Buy…and when I shop at Abt, I never go home and order on Amazon. They treat their employees well, and it shows in the service. You pull up the price on Amazon, and they match it…we go back again and again. Also, it helps that they have a huge fountain in the back, a thing for kids, and they serve warm cookies and coffee… ;).

    31st January 2013 at 3:48 pm

  11. Thinker says:

    “US value department store JCPenney will begin selectively reinstating sales events in a reversal from its year-old strategy of everyday pricing. The shift comes amid sharp sales and share price declines and persistent shopper backlash against CEO Ron Johnson’s decision to abandon the hundreds of sales and discounts a year that epitomised the retailer’s promotional positioning.”

    Yeah, like that is going to work…

    1st February 2013 at 10:31 am

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