U.S. Bricks and Mortar Stores Closing at Their Fastest Rate

[engine]

According to research by Credit Suisse, many years of overbuilding in the U.S. is taking its toll with bricks and mortar stores which are also feeling the effects of pressure from ecommerce. The research, published in The WSJ shows that stores are closing at their fastest rate.
[wsj.com...]


Ecommerce on its own is not solely to blame.

I can only speak from my own region, and it's clear that rising rents for bricks and mortar don't help, either.
It's difficult to beat the convenience of ecommerce, but it's not the same shopping experience.

Can bricks and mortar stores survive?

[piatkow]

The general loss of shoe shops is weird, I would always prefer to try on shoes before buying rather than mail order.

Internet effects aside I think that there has been over provision of shopping malls in the UK and some are paying the price.

[branko97]

Small shops have been hit all over the Europe. The one thing that can recommend a brick and mortar shop is the personalised service it offers - having a clerk who can really help the customer in chosing and make a customer "come back for more". Though I have quite a few friends that buy online even after they have been to a store to see and try the merchandise.

[buckworks]

buy online even after they have been to a store to see and try the merchandise

Thus, brick and mortar shops are used as free showrooms for their online competition.

Consumers who would never dream of stealing physical merchandise never consider that wasting the shop staff's time also creates unfair costs for the business.

It isn't sustainable if it happens too often.

[smilie]

Restaurants are also closing FAST.

People are broke.

Decades of job outsourcing, no real wage growth, real inflation and growing taxes finally caught up and came back to inevitably bite in the behind.

Ecommerce is only 8% of US commerce, that's not the main factor. Although yes, Amazon dominating over 30% of ALL commerce IS a factor ... By putting small businesses out of business hence thousands of people not being able to innovate (innovations commonly come from small companies).

US Big box store sales are in permanent decline, excluding Nov and Dec 2016:
[tradingeconomics.com...]

[farmboy]

People shop in a store then make the purchase online. People don't get great service in a real store which causes customers to shop online which leads to closing of stores and thus fewer employees.

Seems like a vicious circle.

Are there retailers who provide such a nice experience that people want to come back? Yes, local retailers. Another circle.

FarmBoy

[smilie]

Will copy from another thread , too important for this specific topic.

WE NEED TO IMMEDIATELY DO AWAY WITH a little known Asian subsidy which is KILLING US retail. Did you know a small package sent by an Asian online seller only cost them about $1.00 vs the $20.00 we would have to pay to send a package to Asia. We even provide tracking services on that package. This was pushed down our throats thru the “heavy lobbying” by Ebay and Amazon to promote direct chinese sales on both sites.

Too anti-US and anti-competitive. THIS is killing US retail industry.

I am just going to copy bullet points:
Problems with this is:

1) Post Office loosing hundreds of millions delivering these cheap packages (taxpayers left holding the bag making up for their losses and eventual USPS pension shortfalls)

2) Uninspected goods come in, many of which are in violation of intellectual property laws and safety regulations.

3) USA stores can’t compete- thus many previous full time jobs in retail have disappeared altogether or with lower paying and reduced benefit part-time jobs.

4) Foreign online sellers are not paying any sales tax, income tax, or tariffs like the importers in the USA.

[tangor]

The topic drift is at least drifting in the same direction: retail B&M in difficulty and recognition that OTHER factors are also related to that demise. It's all about the economy .... and all aspects of what that entails, such as self-inflicted trading discrepancies, labor costs (minimum wage being chief), current taxation, increased education costs, rental values .... the list is both long and complex. And the web didn't help slow any of that down, just put it on a down hill roller coaster with no "ups" in the future.

Those of us old enough can look back and say "been there done that" and likely will aver "and do it again and again", but for the younger crowd first experiencing free market and capitalism in the raw it can seem extraordinarily frightening.

[keyplyr]

Sounds pretty bleak.

Things are great where I'm at. Economy has been thriving for 5 or 6 years. The Real Estate crash recovered very strong and although a few restaurants have closed, newer trendy places take their place rather quickly.

A lot of the local economy where I'm at is tech driven: Bio-tech is big, Qualcomm is here, as is Intel and Intuit. The whole city is WiFi'd.

Times are changing where the small brick 'n mortar business model may no longer be possible in many niches.

[tangor]

As they say, location is key.

As for bleak, markets change, trends come and go, panics become booms, booms become burst bubbles ... it's learning to plan ahead, and be prepared/insulated for these swings.

If you've been around long enough this is not news. But for the young kids starting out it's a 2x4 to the forehead, both B&M or webmasters dealing with ad servicing companies... or direct sales. Can be an eye opener. :)

[keyplyr]

It's so expensive to lease a storefront in my area, a typical one or two owner business would have a challenging time making a successful go at it. California is one of the most expensive states in the US and my city is the second most expensive city to do business in. Those that can afford to open their doors typically will stay open. Smaller endeavors tend to go elsewhere.

[tangor]

Most of them move outside California (many end up in Texas).

[farmboy]

Those that can afford to open their doors typically will stay open. Smaller endeavors tend to go elsewhere.

Selling things to new businesses seems to be the business to be involved with.

FarmBoy