United States retailers are bracing for a fresh wave of store closures at the start of the new year as shopping continues to shift online and foot traffic to malls declines, according to analysts.
"If you are weaker player, it's going to be a very tough 2017 for you, " said RJ Hottovy, a consumer equity strategist for Morningstar.
Business Insider reported that Hottovy said he's expecting a number of retailers to file for bankruptcy next year, in addition to mass store closures.
Nearly every major department store, including Macy's, Kohl's, Walmart, and Sears, have collectively closed hundreds of stores over the last couple years to try and stem losses from unprofitable stores and the rise of ecommerce.
But the closures are far from over.
Macy's has already said that it's planning to close 100 stores, or about 15 percent of its fleet, in 2017. Sears is shuttering at least 30 Sears and Kmart stores by April, and additional closures are expected to be announced soon. CVS also said this month that it's planning to shut down 70 locations.
Mall stores like Aeropostale, which filed for bankruptcy in May, American Eagle, Chicos, Finish Line, Men's Wearhouse, and The Children's Place are also in the midst of multi-year plans to close stores.
Many more announcements like these are expected in the coming months.
The start of the year is a popular time to announce store closures. Nearly half of annual store closings announced since 2010 have occurred in the first quarter, CNBC reports.
In addition to closing stores, retailers are also looking to shrink their existing locations.
"As leases come up, you're going to see a gradual rotation into smaller-footprint stores," Hottovy said.
Despite recent closures, the US is still over-saturated with stores.
The US has 23.5 square feet of retail space per person, compared with 16.4 square feet in Canada and 11.1 square feet in Australia — the next two countries with the highest retail space per capita, according to a Morningstar report from October.
"If you are weaker player, it's going to be a very tough 2017 for you, " said RJ Hottovy, a consumer equity strategist for Morningstar.
Business Insider reported that Hottovy said he's expecting a number of retailers to file for bankruptcy next year, in addition to mass store closures.
Nearly every major department store, including Macy's, Kohl's, Walmart, and Sears, have collectively closed hundreds of stores over the last couple years to try and stem losses from unprofitable stores and the rise of ecommerce.
But the closures are far from over.
Macy's has already said that it's planning to close 100 stores, or about 15 percent of its fleet, in 2017. Sears is shuttering at least 30 Sears and Kmart stores by April, and additional closures are expected to be announced soon. CVS also said this month that it's planning to shut down 70 locations.
Mall stores like Aeropostale, which filed for bankruptcy in May, American Eagle, Chicos, Finish Line, Men's Wearhouse, and The Children's Place are also in the midst of multi-year plans to close stores.
Many more announcements like these are expected in the coming months.
The start of the year is a popular time to announce store closures. Nearly half of annual store closings announced since 2010 have occurred in the first quarter, CNBC reports.
In addition to closing stores, retailers are also looking to shrink their existing locations.
"As leases come up, you're going to see a gradual rotation into smaller-footprint stores," Hottovy said.
Despite recent closures, the US is still over-saturated with stores.
The US has 23.5 square feet of retail space per person, compared with 16.4 square feet in Canada and 11.1 square feet in Australia — the next two countries with the highest retail space per capita, according to a Morningstar report from October.
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