The state of retail is pretty depressing at the moment.
With consumers cutting back on spending, hundreds of retail outlets across the U.S. are closing. Some companies are cutting back on stores, while others are closing for good and liquidating their inventories.
The recession is causing a massive reset of the retail industry in the U.S. It’s survival of the fittest. Wal-Mart Stores and Best Buy, for instance, are managing the downturn better than most.
The same Darwinism is affecting shopping malls. Those with the best locations and retailers will do well. Those with second-tier locations and tenants will be hit disproportionately hard.
A strip mall in Skokie, Ill., now sits half empty two blocks south of the more prosperous Old Orchard Shopping Center. The strip mall is losing another anchor tenant in Office Depot, which has been closing underperforming stores nationwide. The empty store fronts with papered windows and for-lease signs are pretty sad.
In the last year, Circuit City, Mervyns, Linens N Things, Tweeter, The Sharper Image, Steve & Barry’s and KB Toys all have gone belly up. Given the prospects for the economic recovery, more names could join that list.
(Photo of Office Depot store in Skokie, Ill, holding a store-closing liquidation sale this month.)