- This is the second report in our X Factor series, in which we identify themes that we believe will be critical for the US retail landscape in the second half of 2017 and beyond. We focus on the store in this report, as we believe the store will be one of the key factors that will make or break a retailer.
- The retail environment so far in 2017 has been rather bleak for traditional retailers, overshadowed by the large number of store closures and bankruptcies―far exceeding that of previous years. Since the start of the year, 28 major retailers have announced plans to close down stores―over 5,300 to date―while 10 major retailers have declared bankruptcy.
- The reasons retailers are struggling include pressure from the growth of e-commerce, consumers’ shift to online shopping and dwindling mall traffic, to name a few.
- But it is not all gloom. Amidst this rather bleak retail sector, there are some bright spots―fast fashion, discounters and e-tailers seem to be faring well.
- Opportunities abound for retailers making an effort to combat the disruptive e-commerce―in the form of improved operating leverage from the consolidation of physical stores and sales redirected from closed stores or bankruptcies.
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