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American retail culture may well have reached a tipping point.
Major department stores are floundering about like fish in a rapidly draining pond after reporting dreadful earnings last week.
The time-honored multigenerational giants like Macy’s, Sears and JCPenney are all looking at a dramatically different future.
Macy’s stock collapsed 17 percent after Thursday’s first-quarter report. And high-end retail behemoths like Nordstrom are getting clobbered, too. Shares of that politically petulant retailer fell 11 percent Thursday on news of its first-quarter results.
Better take a good look, because this may be last call for the mall.
The rise of online retailing and the disenchantment of shoppers with the department store is rapidly leading to the demise of American shopping meccas. For decades, malls have been anchored by super-sized department stores occupying tens of thousands of square feet.
So now what to do?
There are not a lot of large tenants that can come in and easily assume these massive spaces. The mall movie theater is also slowly going away.
Large gyms have popped up in some mall spots, and that’s good for those malls (and America’s waistlines). However, America doesn’t require that many gyms.
Macy’s first-quarter results were so weak that it prompted the Chief Executive Jeff Gennette to say that he was “not going to say that we’re not going to close more stores.”
In other words, get ready for more closures and pink slips.
Say goodbye to your favorite department stores, or be prepared to drive a little farther to shop there.
If I owned a mall — which I don’t — I’d look to convert it into a data center.
While it’s being looked at as a viable option by some, if that pays the rent, it would be OK with me.
Hey, it’s just business — if you can’t beat ’em, you might as well join ’em.
Contributor: NY Post