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"10 Big Retail Stores That Will
Disappear In The Months Ahead"
by Epic Economist
"We continue to lose some of our favorite brands and stores to this crazy economy. Retail experts are stunned by the pace at which some of the most well-established companies are decaying, and even household names that have been with us for decades are at risk of going out of business during this downturn, according to an updated report recently released by credit-rating company Moody’s Analytics. In the past two years, hundreds of companies fell prey to the dreaded retail apocalypse. Thousands of stores have been permanently shut down, and countless jobs were lost in the process. Now, new numbers show that the entire sector is still struggling as cash-strapped Americans pull back on spending, foot traffic at brick-and-mortar locations faces a precipitous decline, and retailers’ balance sheets are impacted by a massive glut of inventory that is not selling.
This Black Friday also marked a stark reversal for the sector. According to the Financial Times, we just had the first Black Friday in which retailers seen real-term fall in revenues and sales since the global financial crisis. That's quite alarming given that the event is considered the informal start of the peak shopping season. We're now witessing a turning point for consumer spending, as the highest inflation since the early 1980s erodes shoppers’ purchasing power. Retail sales volumes declined from 13.5% in 2021, to mere 4% this Black Friday, data from S&P Global Market Intelligence showed. Michael Zdinak, who leads S&P’s US consumer markets service, says that the exceptional combination of high inflation and a 2.9% rise in unemployment rates took many companies by surprise. “There’s not another year like it,” he said.
With over 80% of Americans worried about rising prices, and 75% worried about the prospect of a prolonged economic recession, according to a brand new CNBC poll, it is safe to say that the outlook for retail sales growth is still compromised.
Consumers are feeling the impact of the most severe cost of living crisis in modern time. Their ability to keep up with rising costs and afford everyday essentials is getting increasingly limited, and now rising interest rates and higher borrowing costs have begun to bite. “Consumers are stepping back, they’re changing how they allocate their spending,” said Mary Daly, president of the San Francisco Fed.“They’re dealing with high inflation, of course, so they have to make trade-offs and put things back that they would otherwise get, but they’re also preparing for a slower economy.”
Last week, James Bullard, president of the St Louis branch of the Fed, told reporters that businesses face a “very dicey situation if they get the pricing decision wrong”. “If they try to raise prices too much and too far ahead of whatever their rivals are doing, they will lose market share,” he said, adding that such a loss tended to be “permanent, and it can even put you out of business entirely”. Today, we compiled 10 of the most popular retailers at risk of defaulting their debt, going bankrupt, and closing their doors for good in the coming months."