A new study found that for every store that shuts its doors, five more go into business
By NACS Online // August 14, 2019
For every store that closes, five are opened, according to a new report from IHL Group, Chain Store Age reports. Last year, more than five retail chains opened stores for every location that shut its doors. IHL also found that the number of chains opening new locations jumped to 56% in 2019, with the number of stores closing dropping by 66% over the past year.
“Retail Renaissance–True Story of Store Openings/Closings” found that in 2018, 20 chains accounted for 52% of all store closures, while this year, the 20 chains that announced the most location closures represented 75% of all closures.
“U.S. retail has increased $565 billion in sales since January of 2017, fed not just by online sales growth but net store sales growth,” said Lee Holman, vice president of research for IHL Group. “Clearly there is significant pressure in apparel and department stores, however, in every single retail segment there are more chains that are expanding their number of stores than closing stores.”
IHL reported that “64% of retailers are increasing the number of stores in 2019, 12% are decreasing and 24% report no change in store counts. This compares to 2018 with 41% increasing store counts, 37% decreasing and 22% with no change.”
For every chain that closed a location, more than five chains (+5.2) opened new stores. Here are the ratios by segments:
- Food/drug/convenience/mass merchants: +9.5
- Apparel, hard goods, department stores: +3.7
- Restaurants, fast food, table service: +6.3