Every week, it seems a new retailer is shuttering stores.
According to an estimate from Credit Suisse, U.S. retailers are on track for more than 8,000 store closings this year, even more than in 2008, at the peak of the financial crisis. Some have called it a retail apocalypse, as the forces of e-commerce and bloated debt burdens are forcing a number of retailers to declare bankruptcy or downsize. Urban Outfitters’ CEO declared that after years of overexpansion, “the retail bubble has burst.”
Here are the seven brand-name retailers that are closing the most stores this year.
1. RadioShack: 1,430 stores
RadioShack, once known as “America’s technology store,” has been in decline for a long time. After years of losses, the company declared bankruptcy in 2015, but a deal with Sprint (NYSE: S) saved much of its store base at the time. However, that fix proved temporary, as the company filed for bankruptcy protection again in March and then closed 1,000 stores over Memorial Day weekend, on top of 430 it had previously closed. That’s left just 70 company-owned stores and 500 dealer-owned locations operating.
Mismanagement and aggressive share buybacks dug RadioShack’s grave. Like much of electronics retail, including H H Gregg and Circuit City, it’s gone belly-up.
2. Payless ShoeSource: 800 stores
Privately held Payless ShoeSource is also meeting its maker. The discount footwear chain filed for bankruptcy protection in April, saying at the time it would close 400 stores and later added another 400 to the list.
That’s only 20% of its store base of 4,000, meaning we’ll probably see more store closings from Payless. As with other mall-based retailers, Payless has suffered from declining traffic to shopping centers, a trend that’s unlikely to reverse. Therefore, the prospects of a Payless comeback are doubtful.
3. Rue21: 400 stores
Following a long list of other teen retailers, including American Apparel and Aeropostale, Rue21 filed for bankruptcy protection in May, saying it would close approximately 400 stores out of its fleet of 1,179. The retailer was seeking the court’s permission to borrow $175 million in additional financing, and the company expressed optimism for its business after improving its cost structure. Still, the outlook remains dim for a mall-based teen retailer like Rue21.