AP
- Several chains have said they're planning reductions in their store numbers for 2025.
- Topping the list are Advance Auto Parts and Walgreens, which will shutter 1,200 stores combined.
- If this year's closures are any indication — and if the economy worsens — they won't be alone.
2025 is still more than a month away, but it's already shaping up to be another rocky year for retail.
Several chains have already announced planned reductions in their store fleets for 2025. Analysts at UBS project the total number of US retail closures could reach 45,000 over the next five years.
While UBS said that number would be led largely by smaller stores going out of business, some larger companies are also trimming their store footprints in response to changing consumer trends such as e-commerce, remote work, and other financial pressures.
The shutdowns follow a tough 2024. A Business Insider tally of disclosures from 13 retail chain brands found that more than 2,000 stores have closed or are set to close across the US this year, and more comprehensive figures from Coresight Research put the number far higher, at 6,189 so far this year.
Topping the 2025 list so far is Advance Auto Parts, which said Wednesday that it will close 727 locations by the middle of next year.
"This action is prudent to support the long-term health of the company," CEO Shane O'Kelly told investors on the company's third-quarter earnings call.
Earlier this year, Walgreens made headlines when it said it would shutter about 25% of its 8,700 US locations over the next three years, starting with 500 in 2025.
Other brands include Denny's, with 100 closures in the works (following 50 this year), and Macy's, which has between 50 and 100 locations on the chopping block next year.
If the past is any indication, these won't be the only ones.
For one thing, even healthy retailers like Walmart and Target periodically review and trim their store fleets in the normal course of business. In fact, analysts have previously told BI that companies should.
Beyond that, some brands don't survive forever, even if they're beloved today — remember the ubiquity of Blockbuster, K-Mart, or Bed Bath & Beyond?
Possible new tariffs and trade proposals during Donald Trump's second presidency could also increase the cost of some items, causing trouble for struggling retailers.
In any event, the year hasn't even begun, but nearly 1,500 retail closures are slated — already roughly half the amount BI has tracked for full-year totals in recent years.