The real reasons stores such as Walmart and Starbucks are closing in big cities By Nathaniel Meyersohn,
https://www.cnn.com/2023/05/12/business/stores-closing-cities-downtown-retail/index.html
These big chains and others have closed stores in major US cities recently, raising alarm about the future of retail in some of the country’s most prominent downtowns and business districts.
Several forces are pushing chains out of some city centers: a glut of stores, people working from home, online shopping, exorbitant rents, crime and public safety concerns, and difficulty hiring workers.
To reinvent downtown retail, drastic changes may be required.
Some of those policymakers, including both Republican and Democratic leaders, have pointed to crime as a chief reason for the closures, following videos of brazen shoplifting incidents.
“We’re losing chain stores that are closing down. People who are being employed in those stores are losing their jobs” because of crime, New York City Mayor Eric Adams, a Democrat, said in February.
But the impact of shoplifting may have been overstated in some cases.
Walgreens said it saw a spike in losses, known as shrink, during the pandemic and cited organized retail crime in its decision to close five San Francisco stores in 2021. But it recently backtracked.
“Maybe we cried too much last year” about shrink numbers, a Walgreens executive said in January.
And instead of a strong correlation with crime rates, the closures aren’t also a recent phenomenon.
San Francisco, Los Angeles, San Diego, New York City, Seattle, Miami and Chicago lost retail stores from the beginning of 2017 to the end of 2021, according to research from the JPMorgan Chase Institute, a think tank.
What’s more, experts agree, the closures aren’t just about crime. Several trends have converged to put these stores at risk.
Perhaps most key is the glut of stores in America.
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