Retail's Great Reckoning: Why Stores are Closing Faster than Ever

The retail landscape is undergoing a seismic shift that demands our attention. With a projected 15,000 store closures across the United States in 2025, double last year's figure, we're witnessing what can only be described as a retail reckoning. Major players like Macy's, Walgreens, and Rite Aid are scaling back, while European legacy brands such as Claire's and Hamley's face similar challenges abroad.

But this isn't simply a story about retail's demise. What we're experiencing is a necessary culling of physical retail spaces that have failed to evolve with consumer expectations. The root causes extend far beyond e-commerce competition: rising operational costs, cautious consumer spending, bloated store networks, and crucially, a failure to modernize the in-store experience for today's shoppers who demand convenience, personalization, and compelling reasons to visit physical locations.

The retailers who will survive and thrive are fundamentally reimagining their physical presence. They're transforming stores into multifunctional spaces that serve as fulfillment hubs for online orders, community gathering places, and experience centers that digital channels can't replicate. They're creating seamless connections between online and offline worlds, investing in both technology-enabled experiences and frontline talent, and constantly justifying every square foot of their real estate portfolio. The message is clear: physical retail isn't dead, but outdated store models certainly are. For retail executives, the question isn't whether to change, but how quickly you can transform to meet the demands of this new retail reality. Are you ready to reimagine what your stores mean to customers?

Episode Transcript

Speaker 1 (00:03):
Well, hello everyone, I'm Scott Benedict, you know.
I think we should probably talkabout one of the topics that's
really been grabbing headlines.
And,000 stores shut down acrossthe US in 2025.
That's double the number fromlast year.

(00:32):
And it's not just troublechange here.
Names like Macy's, walgreens,rite Aid or Big Lots.
They're all trending back.
But across the pond, legacybrands like Claire's and
Hamley's are sharing locationsin Europe as well.
So what's behind this retailbloodbath?

(00:52):
Well, it's not just e-commerce.
It's a mix of rising costs,slower discretionary spending,
overbuilt store footprints and,in many cases, a failure to
modernize the store experience.
Consumers today expectconvenience, personalization and
a reason to come in, a reasonto shop, and, let's be honest,

(01:16):
many of these stores haven'tdelivered that outcome in recent
years.
But here's the kicker it isn'tjust a collapse, it's a culling,
if you will.
A reduction in the size of thestore herd out there.
Retailers who survive and thrive, in my view, are the ones who
are rethinking what a physicalstore means.

(01:37):
They're turning stores intofulfillment hubs for online
orders, for community spaces andfor experience centers.
They're connecting online andoffline in ways that are
seamless for shoppers andoperate efficiently behind the
scenes.
The retailers who survive andthrive.

(01:59):
In a moment like this, reallyprovide a wake-up call to the
rest of the industry, because ifyour stores are just
transactional spaces, I view orI believe that you're vulnerable
.
If you're not investing intech-enabled experiences and in
your frontline talent, I believeyou're behind.

(02:20):
If you're not constantlyre-justifying your square
footage, your CFO will do it foryou, and not always in a
pleasant way, and so I believethe opportunity now is to be
intentional about where, how andwhy you show up for customers
in your physical locations,because a physical store isn't

(02:43):
dead, but old, tired, outdatedstore models are, and that's a
bit of a different story.
What are you going to do aboutit?
Well, I think that's a questionthat every retail leadership
team should be asking.
That's all for today.
Thanks for listening.
I'm Scott Benedict.