These retail chains are growing, offsetting others' closures: Report
Fox Business Briefs: Pizza Hut is planning to close hundreds of restaurants as it shifts its focus to delivery and fast-casual dining.
Sears is closing more stores. Pizza Hut plans to shutter hundreds of restaurants. Dressbarn expects to shut down all its locations this year.
Despite the dire outlook for brick-and-mortar retailers competing against online giants like Amazon, a new report from research and advisory firm IHL Group found that more chains are opening more new locations than closing them.
The number of chains closing stores peaked at 612 last year, according to the report. This year, that had dropped 6 percent. Meanwhile, the number of chains opening new locations increased by 56 percent this year, up to 1,065 stores from 675 in 2018.
Marathon, Five Below, Dollar General, Ulta Beauty, Dollar Tree, Casey’s, Ross, Tractor Supply, Walgreens, O’Reilly Auto Parts, 7-Eleven and Couche-Tard have all been “showing healthy expansion,” according to the report.
For every chain with a net closing of stores, five chains are opening stores, IHL Group found.
In 2017, 4,100 more stores opened than closed across the U.S., and about 1,400 more stores opened than closed in 2018. This year, IHL estimates close to 3,000 more stores have opened than closed.
Having physical locations remains important for stores, according to IHL. Online sales growth has slowed in the past two years, and the firm’s analysis found that online sales decrease in a region after physical stores there close.
That’s why even online retailers like Amazon are opening some brick-and-mortar stores, according to the research and advisory firm.
Through June of this year, retail sales were up 3.1 percent, according to the report. Convenience stores and mass merchants have done “outstanding” while DIY, furniture, liquor and grocery stores have also done “very well.”