Huge retailer sets closing date for dozens of locations
The past few years have been brutal for retailers, and many are succumbing to the pressure.
Much of the pain started during the pandemic when stay-at-home orders forced consumers to change how they shop. In 2020, many people got used to online purchases and haven’t looked back. But that’s been particularly harmful to department stores.
Department stores offer the benefit of a wide selection under one roof. Consumers often come in for one item and leave with more—a habit that hurts their wallets but benefits the retailers that need sales. But given the shrinking popularity of department stores, it’s getting harder to capitalize on consumer impulse purchases.
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Plus, as consumers spend their money more mindfully due to factors like inflation and sky-high interest rates, it’s been hard for retailers to stay competitive. Even stores with a loyal fan base have seen their bottom lines shrink as consumers prioritize essential expenses over non-essential retail purchases.
Not surprisingly, a number of major retailers have filed for bankruptcy in recent years and closed stores accordingly.
Last year, mall mainstay Express filed for bankruptcy, citing financial obstacles. And earlier this month, Forever 21 filed for bankruptcy and announced plans to liquidate its inventory.
Now, another major retailer is firming up store closure plans in an effort to regroup and maximize its financial resources.
Kohl’s has long had a loyal following. Customers like the store’s changing inventory and rewards program.
In fact, the Kohl’s Cash program has long been beneficial to the department store giant as a means of luring customers back to the store. Kohl’s Cash can’t be used indefinitely. Rather, it has an expiration date, strategically putting pressure on consumers to make a return shopping trip.
Related: Kohl’s suffers major losses amid alarming consumer trend
But despite the many things Kohl’s has going for it, it’s not immune to the general struggles retailers face today. During its last earnings call, the company announced that it anticipates a revenue decline for 2025.
In January, Kohl’s cut almost 10% of its corporate workforce. It also recently announced that it would stop accepting Amazon returns in certain locations.
Kohl’s established its partnership with Amazon to attract more customers. But while that arrangement may have benefitted Amazon, it’s clear that Kohl’s did not win.
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