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Retail Store Openings Increase In 2017

Retailers are opening 4,080 more stores in 2017 than they are closing and plan to start over 5,500 new locations in 2018, according to a  report from IHL Group.

The study reviewed over 1,800 retail chains with more than 50 U.S. stores in 10 retail vertical segments. It found that for every business with a net closing of stores, 2.7 companies showed a net increase in store numbers for 2017.

Highlights of the research cover the following:

  • The total net addition of stores for 2017 is 4,080, including shops and restaurants. Core retail sections will show a net gain of 1,326 stores, table-service and fast-food restaurants are adding a net of 2,754 spots. In total, retail chains are starting a net 14,239 stores and closing 10,123 stores.

  • 42% of companies have a net increase in stores, only 15% have a net decrease, and 43% state no change.

  • The three fastest growing key retail segments are mass merchandisers such as off-price retailers, dollar stores (+1,905 stores), convenience retailers (+1,700 stores), and grocery stores (+674 stores).

  • Specialty apparel retailers see the largest number of closings, with a net loss of 3,137 stores. For every chain closing shops, 1.3 chains are opening new stores.

  • When it comes to chains shuttering stores, only 16 chains account for 48.5% of a total number of stores closing. Five of those chains (Radio Shack, Rue21, Payless ShoeSource, Ascena Retail and Sears Holdings) represent 28.1% of the total closing.

“Without question, retail is undergoing some fundamental changes. The days of ‘build it, and they will come’ are over,” said Greg Buzek, president of IHL Group. “However, retailers that are focusing on the customer experience, investing in the better training of associates and integrating IT systems across channels will continue to succeed.”

The report "Debunking the Retail Apocalypse" is available here.
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