The grim reaper is on a shopping binge.
The number of shuttered stores this year is already outpacing last year’s rate — and showing no signs of slowing down.
Last week, Men’s Wearhouse said it will close a whopping 250 stores, while Sports Authority filed for bankruptcy and announced plans to close 140 stores earlier this month.
In February, Kohl’s said it will close 18 underperforming stores. Others such as teen retailer Aeropostale, with more than 900 stores, are teetering on the brink of insolvency.
Big-box retailers, including Walmart, Macy’s and The Gap, are also culling stores, blaming a weak holiday season, increased competition and customers’ preference for shopping online, among the reasons.
While most retailers typically trim their ranks at the beginning of a new year — up to 50 percent of store closures happen around now — some industry experts say this year could be the beginning of a big shakeout.
“We are hitting a tipping point,” said Richard Church, managing director of Discern Investment Analytics. “We are in a weak demand environment that could meaningfully accelerate next year.”
The number of store closures during the first two months of 2016 is already 33.2 percent higher — hitting 501 stores — than the same period last year, according to an analysis by Church’s firm. That compared with a 29 percent increase in 2015 over the previous year and a 6.3 percent increase in 2014.
Underscoring the trend is government data showing that US retail sales dropped 0.4 percent and 0.1 percent in February and January, respectively, according to the Commerce Department.
The hardest-hit sector is apparel, while restaurants and food stores “are holding up,” according to Michael Wiener, president of Excess Space Retail Services Inc.
JCPenney, for example, moved out of the Natick Mall in Natick, Mass., last year where a Wegmans Food Market is moving in, taking over 125,000 square feet.
The so-called “over storing of America has been occurring over the past decade, and in a slow growth period like now, weaker performers get washed out,” said Craig Johnson, president of Customer Growth Partners.
Compounding the real estate problem for traditional brick-and-mortar retailers is growing competition from online retailers like Amazon.com and also their own e-commerce businesses as about 13 percent of purchases have shifted to online.
Mall operators are investing in redeveloping their properties rather than in new construction, according to International Council of Shopping Centers.
Despite the retail carnage, ICSC maintains that the average occupancy rate for shopping centers is 94 percent, though industry experts point out that the number is skewed.
“The A malls are doing fine,” said Johnson, “but the B and C malls are not.”