As more and more people shop online, the ongoing wipeout of brick-and-mortar retail stores will continue.
One study shows that by 2030, a mere four years from now, 40,000 more retail stores could close down. This is after more than 10,000 retail closures since 2023.
Per the study, the primary victims will be “clothing, consumer electronics, home furnishings, office supplies, and sporting goods.”
Here’s an interesting number — the “forecast is that e-commerce penetration rates in the U.S. will top 27 percent by the end of the decade, up from the current 22 percent.”
So, physical stores will still dominate retail. But what kind of physical stores? “Big-box retailers have accounted for much of the growth in retail footprint,” reads the report. “This is yet more evidence that the death of mom-and-pop retailing will accelerate.”
Two points…
The first is that what this all comes down to is convenience and price. Stuff is usually cheaper at a dot-com like Amazon, and that includes the miracle of having it delivered right to your front door. We truly do live in a wondrous age.
A couple of weeks ago, the wife and I were out of town and had a few minutes to kill, so I browsed around a Barnes & Noble for the first time in at least 15 years. The prices were outrageous. Buying a book or movie that day would’ve made me feel like a sucker. All that stuff is wayyy cheaper online.
As far as big box retail versus mom and pop stores, it’s the same thing. Not all the time, but in general, Walmart is cheaper than smaller stores. But here’s something you don’t read a lot about that puts these giant retail stores in the plus column: the convenience of one-stop shopping.
Let’s say you need milk, a pair of slippers, a quart of motor oil, a birthday cake, sewing needles, a prescription, Mother’s Day flowers, a gallon of paint, a DVD player, grass seed, and condoms… Walmart has you covered. It’s all right there under one roof. One stop and you’re done. This eliminates that awful Full Day of Doing Errands. No running to the paint store after the grocery store after the garden store after the electronics store… All the traffic and parking hassles eliminated… Instead, you’re in and out in 90 minutes or so.
Time is precious.
Secondly, it’s not as though net jobs go poof with the closing of 40,000 retail stores. Online buying also creates jobs. You need people making the boxes, packing the boxes, and delivering the goods. There’s an entire employment ecosystem involved in e-commerce, and it seems fair to wonder if getting people out from behind cash registers and into factories, warehouses, and UPS trucks isn’t an overall improvement as far as wages and the cultural world of physical labor.
Fewer strip malls in America…? Oh, no, not that.
P.S. The fact that 2030 is less than four years away is kind of freaking me out.