Rising Store Closures: Unseen Consequences on Local Economies and Communities

Woman shopping for fruit in a grocery store.

The retail industry faces profound changes in 2024, with a staggering 69% increase in store closures impacting communities nationwide.

At a Glance

  • 69% rise in store closures in 2024 led by Big Lots, CVS, and Family Dollar.
  • 7,308 confirmed or planned store closures, with Family Dollar and CVS notable leaders.
  • Impact on local communities, economies, and urban development decisions.
  • High inflation and online shopping impact traditional retail models.

Massive Surge in Store Closures

In 2024, the retail sector experienced a significant downturn, witnessing a 69% rise in store closures compared to the previous year. Large chains such as Big Lots, CVS, and Family Dollar led the way. These closures signal a strategic shift as retailers navigate a challenging economic landscape characterized by increased competition from online platforms and pressures like high inflation.

The surge is notable, with confirmed or planned closures totaling 7,308 by November 2024. While there were also 5,818 store openings, the net effect weighed heavily on numerous communities across the nation. Family Dollar topped the closure list with 718 locations shut, while CVS and Big Lots followed with 586 and 580 closures, respectively.

Impact on Communities and Economies

The closure of brick-and-mortar stores impacts more than just consumer shopping options. It results in economic challenges, community disruption, and urban development struggles. Areas become void of essential services, leading to vacant commercial spaces and disrupted livelihoods for store employees.

“There is not enough growth in the retail market for every player to do well, which is why we are seeing polarized results.” – Neil Saunders

Retail closures affect urban planning and real estate markets. Economies depending on retail as a key component are forced to reassess growth and development strategies. Consumers face reduced accessibility to goods and services in affected areas, compounding the economic stress on families who rely on budget-friendly solutions from discount stores.

Changing Consumer Behavior and Economic Struggles

The increasing shift in consumer preferences toward online shopping platforms like Amazon has exacerbated these closures. High inflation and interest rates cited by many companies have compounded these difficulties, causing financial strain across the retail spectrum.

“High inflation” and “high interest rates” are commonly cited hurdles for these businesses.

Despite strong consumer spending, brands like Walmart are adapting to shoppers’ evolving needs as disposable incomes tighten. However, stores such as Target, Family Dollar, and CVS face significant challenges, with some forced to reconsider their strategies for long-term survival.

Sources

1. 2024 was tough for brick-and-mortar businesses. North Jersey lost these old favorites

2. US store closings up 69% in 2024 amid Big Lots, CVS, Family Dollar cuts

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