April 26, 2016 by Zach Hoffman
In a recent article published by the Wall Street Journal, Green Street Advisors, a real-estate research firm, has estimated that department stores will need to close hundreds of locations if they plan on regaining the productivity they had a just a short decade ago.
A senior Green Street analyst has been quoted as saying: “Department stores used to be a great catchall for different brands, but today many of the brands have stores of their own and shoppers can also find them online”.
According to the article, last year’s department store sales averaged at $165 a square foot, which is a 24% drop since 2006! Major department stores have been forced to close hundreds of locations in recent years due to the rise of discounters and other online merchants such as Amazon.com Inc. For instance, just last Thursday Sears said it would be closing 78 stores including 68 Kmarts, this summer, which was part of a plan announced in February to close any unprofitable stores.
In case you couldn’t already tell, Brick and mortar is a thing of the past and this is only the beginning for e-commerce.
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