Clothing retailers, consumer electronics companies and home furnishing businesses will need to close more stores across the U.S. as e-commerce sales proliferate, according to UBS.
In a note to clients this week, the investment firm said “store rationalization needs to accelerate meaningfully as online penetration continues to rise.” Assuming online sales’ share of total retail sales in the U.S. grows to 25% by 2026, from 16% today, roughly 75,000 more retail doors, excluding restaurants, need to close, analysts Jay Sole and Michael Lasser said. That means for every 1% increase in online penetration, roughly 8,000 to 8,500 stores need to close. A lot of that growth is being fueled by Amazon, which is expected to account for about half of the U.S. e-commerce market.
Within that 75,000 number, about 21,000 clothing stores, 10,000 consumer electronics stores, 8,000 home furnishing stores and 1,000 home improvement stores should close, UBS estimated, based on the firm’s assumed growth rates of online penetration within each retail subsector. It added about 7,000 grocery stores could close if online grocery penetration rises to 10%, from 2%, by 2026.
www.cnbc.com/2019/04/09/75000-more-stores-need-to-close-ubs-estimates-as-online-sales-grow.html