Macy’s has recently announced that it is laying off 10,000 workers, and J C Penney is closing up to 140 stores.  This is not great news for those of us watching the health of retailing in the US, especially since one of the reasons given in a recent article in The Guardian is that “people aren’t spending.”

The article goes on to quote Richard Hayne, CEO of Urban Outfitters, as saying that the US now has six times the retail space per capita of either Europe or Japan.  “The US market is oversaturated with retail space and far too much of that space is occupied by stores selling apparel,” he said, anticipating that retail retrenchment would continue “for the foreseeable future and may even accelerate.”

The logical result of this situation is the closing of some stores, especially those concentrating on clothing — which has been the focus of many department stores as well as specialty chains.  “Brick-and-mortar stores will exist in the future but there will be fewer of them,” a report from Synchrony Financial quoted in The Guardian article predicted. 

In the stores of the future, according to this report, consumers will expect to share ideas and be entertained.  They will want a social experience that may involve a craft demonstration, music, food or beverage.  And technology may replace the traditional checkout process as it already has in the Apple stores.

Where there are too many stores, it makes sense that some will not survive.  But being small and nimble can pay off (it is worth noting that 6,200 of the 10,000 Macy’s employees losing their jobs are managers).  And not concentrating solely on clothing would also seem to be a good idea, since nothing is more fickle than the fashion market.

Make sure that your staff is working efficiently, and keep your inventory under control. Stay up to date on technology and social media. Look for opportunities to provide experiences beyond the usual to your customers, and keep in touch with them on a personal level. If there will always be brick-and-mortar stores, you want to make sure that yours is one of them.

Happy Retailing,

Carol “Orange” Schroeder