It's time for the January follies, when retailers announce layoffs and store closings following the holiday selling season. We've already heard from Macy's (NYSE: M), Target (NYSE: TGT) and Sears (NASDAQ: SHLD), but could be in for a "Tsunami of store closures," according to Belus Capital Advisor's Brian Sozzi.
Sears announced the closing of its Chicago flagship location, capping off roughly 300 store closures in the past four years. J.C. Penney is closing 33 locations and slashing 2,000 jobs, Macy's is laying off 2,500 employees and Target is cutting 475 jobs in the wake of its messy holiday season.
These could be just the tip of the iceberg, according to CNBC, as retail insiders expect a multi-year contraction for brick and mortar stores. Retail square footage could be cut in half within the next five years, Michael Burden, a principal with Excess Space Retail Services told CNBC.
There may be an increase in smaller store formats as retailers expand their footprint, using these new formats as mini-distribution centers or order pick-up sites as shoppers buy online and pick-up in stores.
That the U.S. is overstored has been a topic and problem within the retail industry for two decades now and the growing dominance of online retail may finally be turning out the lights of big box stores.
For more see:
-This CNBC story
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