In this year alone, over 2, 200 well recognized retail stores have or will have closed across the country. Some chains have shut down completely while others are eliminating from one to 130 stores. The names are very familiar, and I will only name a few of the more than 40 cutting back or totally going out of business.
From Home Depot to Comp USA and from Sharper Image to Ethan Allen the closings are almost too much to understand. The phenomenon of closing stores is also not new. Many of my readers will remember when Montgomery Ward was a retail giant. Other stores no longer in existence are Gimbels, John Wanamaker, Abraham & Straus, Woolworth, Eatons, Kresge and Ames -- just to name a few. In addition, just walk down the streets of your hometown, and there are 'for rent' signs in many store fronts. All of this adds up to why I decided to take a close look at what is happening in the retail marketplace.
First of all, many of the closings can be chalked up to incompetent leadership. Retailing still exists. Wal-Mart has soared and so has COSCO. But, there are changes in the marketplace.
Impacting our ability to shop in retail stores are the higher costs for gasoline and even the food put on our tables. As a result, people have had to shift from the enjoyment of browsing in retail outlets to putting aside money for groceries and gasoline.
There is one other area which has impacted significantly on retailing here in the United States and globally, as well. That is clearly the internet shopper. If you doubt that, because you have not started using a computer to shop, look at these facts.
The growth of retail sales on the Internet has been astounding. From $31 billion in 2001, the growth will hit close to $200 billion this year. That is over a 600 percent increase in just seven years! Retail sales, in stores, have not grown close to the same rate. In fact, there are many months where the store sales are actually lower. The result is that retail sales on the Internet will represent more than 12 percent of all retail sales for 2008.
One other factor which is a negative for retail stores and a benefit for internet shopping is the number of women with full-time jobs, today. Back in 1950 women accounted for only 23 percent of the workforce. Today, 50 percent of our employees are women. Those women are shopping less at retail outlets. Clearly, most are computer literate and shop with ease on the Internet.
Personally, I go to malls less to shop than I do at Amazon.com. Waiting for delivery can be a challenge, but the speed in selection cannot be beat. When the item shopped for is not needed immediately, the Internet provides a great alternative.
In addition, the Internet is great for providing both birthday and holiday gifts to family members and friends scattered around the country and all over the globe. Selecting gift-wrapping and timely delivery all happen with the typing of several words on a computer.
Finally, for any retail organization shutting doors, perhaps their management should have explored Internet options more carefully. By the way, Wal-Mart has just done that with a new online advertising site.
