UBS estimates the number of U.S. retail stores will fall to 782,000 over the next five years from 883,000 last year. That is a far bigger culling than during the 2008 recession, when 28,455 stores closed.
“Going back over the last 20 years, the worst year for closures was 2009 when 2% of stores closed,” said UBS apparel and footwear analyst Jay Sole. “Our forecast calls for 2% of stores to close every year into 2025.”
Before the pandemic, Macy’s said it would close about 125 of its 580 department stores over the next three years. It temporarily closed them all in March. The company has started reopening many of its stores this month, though its chief executive expects the locations that come back first to do less than a fifth of their normal sales volume initially.
“There will still be a real role for stores,” Macy’s CEO Jeff Gennette said in a recent interview, but added the digital business will become even more important and a bigger part of his company’s sales.