The bankruptcy of many brands intensifies
Not even the world's biggest and most expensive famous coffee chain could escape the retail carnage that continues to accelerate across the industry, after facing extensive shortages of big ingredients they need like packaging and staff, the company decided to cut its costs to trying to weather the storm that is brewing in your industry.
Starbucks is currently in the process of closing precisely 500 locations, and your local store could be next on the list.
Then we have stores like Disney, the Disney retailer that sells clothing, toys and other products inspired by their famous movies, are also suffering the lowest sales in their entire time.
h&m one of the world's largest clothing retailers is falling apart in plain sight in January 2023 the company said it still
suffering the losses caused by the “pandemic”, right after that h&m announced that it would permanently close 320 of its stores, a higher number than it had originally said in November 2022, more than 1500 employees will be affected as earnings fall much more than they themselves expected at the beginning of the previous year.
The list continues with stores such as Bed Bath & Beyond, Gymboree, 99 Cents Only stores, True religion, Estee Lauder, Guess among others, with massive layoffs, branch closures, and a change in the business model much more similar to online stores. .
Now the big question is why are these big box stores collapsing around the world, what factors are driving this apparent decline of traditional retail, and how is all of this going to affect us whether you own your own business or are a consumer.
In summary, there is the same pattern in all these stores that are making them go bankrupt. The first is the rise of commerce. One of the main culprits for the decline of physical retail is undoubtedly the rise of electronic commerce. In 2021, sales in online accounted for approximately 21.3% of all retail sales in the world and that number is expected to continue to grow even more in the coming years.
How then can physical stores compete with the convenience and speed that electronic commerce offers precisely; The other factor is the changes in consumer behavior and it is that our buying attitudes have drastically changed in recent years with the proliferation of social networks and the recommendations of influencers.
Then there is of course the impact of the “pandemic” which has had a devastating effect on the retail industry, how many stores were forced to close their doors precisely during the lockdowns and how many were able to successfully reopen once the restrictions were lifted.
The next factor is that brick-and-mortar stores face a constant battle against operating costs such as rent, salaries and utility bills, the more these famous big box retailers can bear before operating costs drive them out of business. its collapse, which is precisely why we are seeing the collapse of many of these companies.
Now I think the most important point, especially if you have a small or large business, the big question is, is there any hope for the future of retail in our communities, the key to the survival of physical stores could definitely be adaptation, it is literally adapt or die and that adaptation has everything to do friends with innovation.
