Retail Apocalypse: Shattered?

In 2008, 6,163 retail stores shut down in the worst year for closures on record. Flash forward, post GFC "recovery" with "robust" wage, employment and economy with looming wage driven inflation hysteria....

Above, in 2017 the ten year old record of 6163 closings was SHATTERED as 8,053 closures and around 3000 openings were announced.

The retail consulting firm IHL Consulting Group compiled a list of 22 retailers bucking the retail apocalypse by growing their store counts. The list, which includes plans for nearly 3,000 new stores this year, is dominated by discount stores and grocery chains, including Dollar Tree, TJ Maxx, Ross Stores, Hobby Lobby, Lidl, Aldi, and Costco

Can we get some confirmation on those numbers? 

"Store closures during the year increased 229% from a year ago, with major US retailers closing some 6,955 stores, the highest recorded rate of closures—exceeding even the annual store closure count during the global economic downturn. At the same time, major US retailers announced 3,433 store openings for the year, up 50% compared to 2016." 

Above confirming opening and closure numbers, as the Fung Global Retail Report indicated MAJOR US RETAILERS closed some 6,955 stores, and announced 3,433 store openings.

Hail Mary, Hail Mary, quite contrary???....

Below, without any breakdown, Statista indicates 14248 openings and 10168 closings for US retail, one has to wonder who the source was?  We dig deeper...

IHL research estimated that with a 4080 net plus through Q3 2017, more stores opened than closed.

IHL research estimates that the enterprise retail market (more than 50 stores) had 4,080 net stores opening through October 2017. In fact, 42 percent of retailers had a net increase in stores while only 15 percent had a net decrease. 

The total net increase of stores for 2017 is 4,080, including retail and restaurants. Core retail segments will see a net gain of 1,326 stores, while table-service and fast-food restaurants are adding a net of 2,754 locations. In total, chains are opening a net 14,239 stores and closing 10,123 stores.

Being suspiciously close to the Statista numbers, we could suppose that IHL (who provided the Business Insider openings numbers) may have been the source. Lets keep digging... 

The negative narrative that has been out there about the death of retail is patently false,” said Greg Buzek, president of IHL Group. “The so-called ‘retail apocalypse’ makes for a great headline, but it’s simply not true. Over 4,000 more stores are opening than closing among big chains, and when smaller retailers are included, the net gain is well over 10,000 new stores." - Debunking The Retail Apocalypse

IHL is a MANAGEMENT CONSULTING firm specializing in technologies for the retail and hospitality industries. 

I don't know but I'll tell you... the Nattering ones seasoned schnoz detects a distinct whiff of something reminiscent from the daze of yore viz. housing collapse.... 

ever upbeat seasonally adjusted results and rosy projections from the National Association of Realtors (NAR) and their "say for pay" Chief Economist cheerleaders.

The NAR turned a blind eye to fraud... they constantly cheerleaded prices, despite evidence to the contrary... continually spun data... presented misleading commentary - The Big Picture - Barry Ritholtz

We can't say if that is the case or there is bias in those contrarian retail numbers, but given the magnitude of retail closures reported from other sources, one might be well advised to take all the stats presented with a grain of salt. Moving West...  

Bottom line, no matter whose number you put more credence in, by either 1K, 2K or 4K, the ten year old record for retail closures was SHATTERED in 2017.... Que up Mick and the Stones.



Many sinking anchors and who holds the debt chain? More to come in A Sinking Wreck? Stay tuned no flippin.

Suggested Reading:
2017 Year End Report FGRT
Debunking the Retail Apocalypse - IHL
2017 IHL Zebra Report
Former NAR Economist David Lereah is a Jackass... Alternative Title: David Lereah: Even More Full of Shit Than Previously Believed