The US Retail Industry is Collapsing: Here’s Why You’re in Trouble

The US Retail Industry is CollapsingThe Organic Prepper

Shopping malls across America are going to look a whole lot emptier soon. An exodus of giant retailers is beginning with the announcement of hundreds of store closures and thousands of people newly unemployed.

The first of January, I broke with my usual tradition and wrote not about positive resolutions, but about the impending rockslide of the US economy. And “rockslide” is an apt word: as one thing starts rolling down the mountain, it will pick up other things until a veritable avalanche of other businesses and people are affected and rolling pell-mell right alongside.  

Last year, we saw announcements of the expected closure of some retail giants. In February of 2013, Michael Snyder wrote on The Economic Collapse Blog that we would see the following:

Best Buy

Forecast store closings: 200 to 250

Sears Holding Corp.

Forecast store closings: Kmart 175 to 225, Sears 100 to 125

J.C. Penney

Forecast store closings: 300 to 350

Office Depot

Forecast store closings: 125 to 150

Barnes & Noble

Forecast store closings: 190 to 240, per company comments

Gamestop

Forecast store closings: 500 to 600

OfficeMax

Forecast store closings: 150 to 175

RadioShack

Forecast store closings: 450 to 550

Unfortunately, it didn’t stop there. This morning, a World News Daily report announced:

Macy’s is closing 14 of its 790 stores across the country.

JCPenney is closing 39 of its stores and laying off 2,250 workers.

Sears has been around for 122 years, but it, too, is closing 235 under-performing stores.

C. Wonder, the preppy retailer, is going out of business, closing all 11 of its U.S. stores in the next few weeks.

Wet Seal is closing 338 retail stores while dealing with bankruptcy proceedings. Nearly 3,700 full- and part-time workers will be unemployed.

Aeropostale, suffering from declining sales, closed 75 stores during the holiday season, which runs from November through January. And in 2015, they expect to close an additional 50 to 75 stores.

RadioShack, which is negotiating with lenders to gain approval to shutter 1,100 stores, said last month that it closed 175 locations in 2014. (source)

Even holiday sales, normally high, plummeted this Christmas.

How does this affect you?

You may not work in retail yourself, but never doubt that the mass closure of these businesses will directly affect you..

Maybe you are wondering how.  You aren’t much of a shopper. You aren’t a retail worker. Perhaps you believe you can compartmentalize this information, pack it away, and go on with your life as you always have.

The thing is, it’s not just the patrons and employees of these stores who are affected. This is going to be catastrophic on a variety of levels.

Let’s go a little bit deeper.

Think about the people who worked in these stores. Now, they’re without jobs. There will be more competition for the smaller number of jobs in America, and many people will not be able to find work. They’ll survive by going on assistance, draining the US coffers even more. As formerly employed people search for work that just isn’t there, we’ll see an increase in foreclosures, repossessions, and welfare.

Think about those who provided the inventory for these stores. Yes, I know a lot of it was made in other countries. But, it was imported here and distributed here. Most businesses work on a “Net-30″ basis, meaning the inventory is delivered, and the payment for that inventory is due in 30 days. And guess what? The companies that imported the merchandise aren’t going to get paid. This will ripple through and cause other businesses to go under, which means still more people are unemployed.

Think about those who transport the inventory. Trucking companies and the independent operators who drive the trucks won’t get money owed to them either. As companies struggle to keep trucks on the road, transport costs will go up, which will cause future inventory in stores to be priced higher.

This is how we’ll be affected:

  • The price of everything is going to go up because wary distributors are going to try to recoup what they’ve lost from these companies that went under, while transporters increase prices to try to cover losses.
  • Jobs will be even harder to get than they were previously – and looking at the unemployment rates, it was pretty darned difficult before.
  • When people have no jobs, they spend no money, crushing the manufacturer’s and retailer’s economy even more.
  • As financial desperation increases, so will crime. And it won’t just be property crime – expect an uptick in violence as property owners fight back.

If you don’t live in an entirely self-sufficient bubble, you can bet you’ll be affected in one way or another.

What can you do about the collapsing economy?

It’s more vital than ever to be aware of what’s going on and to start getting prepared for it on all levels. You need to consider the following:

Create multiple streams of income.  We’d all like to feel like we’re reliably employed, but that’s just not true. You need only to look at the numbers above to see that jobs can be ephemeral. You need to be making money from more than one source (multiple streams of income). Start a small business that provides a safety net. Check out this great article on Graywolf Survival for more information on how to do it.

Learn to shop wisely. A couple of years ago, I wrote this article about how shopping wisely can save you a fortune on your regular purchases. Each purchase needs to be thought out carefully because the day may come when your own personal economic collapse occurs in the form of a job loss, an illness, or a catastrophic bill.

Build a pantry. A well-stocked larder can be your lifeline in the event that your personal finances take a hit. Your supply of food, toiletries, and household items can mean the difference between weathering a storm in relative comfort or going under completely. When I got laid off from my job in the automotive industry, it took 4 weeks before the severance pay arrived, and 9 weeks before my unemployment insurance kicked in. We were able to survive in total comfort due to the supplies we had laid in, and the lower amount of money I was receiving was enough to cover things like the mortgage, car payments, and utilities. Check out my book on building a one-year food supply in 3 months. Another option (although not as thrifty) is to stock up on freeze-dried food for your family. The nice thing is, you can put this at the back of your closet until the day you need it. It’s packaged for the long haul in buckets and it keeps for ages.

Learn to do it yourself. Really, the epitome of preparedness is self-sufficiency. Only when you reduce your dependence on the economy can you be truly unaffected by the things going on in retail-land. Grow it, make it, build it. No matter where you live, you can take steps towards personal independence.  The last half of this book is all about being as self-reliant as possible – it’s a must-read. Learn to live like there are no stores, and if a day comes when there aren’t, you’ll be just fine. Learn skills like canning, sewing, andhomesteading, and figure out how to apply them to your personal situation. Also, don’t just learn them: DO THEM.

Learn to live on less (and enjoy it). When my oldest daughter was a newborn, my husband lost his job. We went through the toughest financial period I ever faced. Quite literally, at one point we had 2 bags of bagels in our freezer, half a jar of peanut butter, and the desperate hope that our vegetable garden would produce enough to get us through until unemployment checks started arriving or a new job was found. I read a book (borrowed from the library and signed out for the maximum allowed number of times) that completely changed my life. If you haven’t read The Complete Tightwad Gazette, I strongly encourage you to read this gigantic bible of frugality from cover to cover.  I still hear Amy Dacyzyn’s “voice” in my head sometimes and my own work is strongly influenced by those lessons she taught me back when I was a new mama. Here’s an article to get you in the frugal mindset.

If you can’t protect it, you don’t own it. Lots of people hate this part, but it’s true. You absolutely must have a strategy for protecting your home and family.  That means you need weapons. You need to figure out how to harden your property against attacks. You must be mentally and physically prepared for the increase in crime that comes with the increase in desperation. I know in my small, sleeping town, property crimes have been on the rise, and sadly, violent crimes are popping up now when they were so rare as to be an anomaly before. This article talks about hardening your home, and this one tells you how to prepare your home for battle, should things really go awry.

Have you seen evidence of this collapse?

How are things in your neck of the woods? I know that where I live, some of the nearby malls are turning into ghost towns. Crime has been steadily rising for the past six months. I personally know several people who have lost their jobs recently due to the closure of the businesses with whom they were employed. Have you seen evidence of this financial downturn? Let’s compare notes in the comments section below.

Resources:

The economy is indeed collapsing, but for most of us, there’s still time to get prepared. If your own situation has collapsed, don’t despair – there are ways to live very well on less. Here are some resources to help you become more self-reliant and less dependent on the financial well-being of others.

Books:

The Prepper’s Blueprint: The Step-By-Step Guide To Help You Through Any Disaster

The Encyclopedia of Country Living, 40th Anniversary Edition: The Original Manual of Living Off the Land & Doing It Yourself

The Pantry Primer: How to Build a One Year Food Supply in Three Months

The Complete Tightwad Gazette

The Organic Canner

Prepper’s Home Defense: Security Strategies to Protect Your Family by Any Means Necessary

How To Use Your Sewing Machine: A Complete Guide for Absolute Beginners

Tools for Survival: What You Need to Survive When You’re on Your Own

Websites:

Ready Nutrition

SHTFplan

Graywolf Survival

Survival at Home

Natural News

About the author:

Please feel free to share any information from this site in part or in full, leaving all links intact, giving credit to the author and including a link to this website and the following bio.

Daisy Luther  lives in a small village in the Pacific Northwestern area of the United States.  She is the author of The Organic Canner and The Pantry Primer: How to Build a One Year Food Supply in Three Months. On her website, The Organic Prepper, Daisy uses her background in alternative journalism to provide a unique perspective on health, preparedness, and the pursuit of personal liberty.  Daisy’s articles are widely republished throughout alternative media. You can follow her on Facebook, Pinterest,  and Twitter, and you can email her at daisy@theorganicprepper.ca

– See more at: http://www.theorganicprepper.ca/the-us-retail-industry-is-collapsing-heres-why-youre-in-trouble-01132015#sthash.4roxxhzZ.dpuf

12 thoughts on “The US Retail Industry is Collapsing: Here’s Why You’re in Trouble

  1. I’m not in sales, but I do work at a fancy outlet mall in east Birmingham, AL – things were slow before, but now, after the holiday season, they’ve completely dropped-off the deep end during the week. January is chronically slow and it can always get worse, but this is unnatural and has anxiety levels through the roof among employees.

    Weekends still see a bump in traffic, but not nearly significant enough and the other 5-days are pathetic; out on patrol, you usually see a person or two wandering about in the distance every once in a while, someone will eventually ask, at times…

    “Hey, where’s the _____ store?”
    “Sorry, they closed after Christmas”
    “Well, what about _____?”
    “Uh, closed”
    “Seriously, well where is the _____?”
    “They’ve been gone for a year”

    We had 4 retailers begin leaving immediately after the season (2 of which were on your list) and only 1 is supposedly slated for replacement. There’s an incoming tourist trap pipe dream supposed to be constructed on the property, but that’s been rumored for years now.

    When I did work sales, it was at malls down in Montgomery, our “sterling” Capitol city. By the time I arrived in town there was already a huge indoor mall that had the ghetto grow-up around it and had run out every serious retailer, then the same began happening to another on the north side. Ever visit a mall where entire wings are darkened and vacant while 2/3 of the stores you do pass are local owned hell holes reselling newly monogrammed Wal*Mart merchandise or handmade beaded necklaces or stolen merchandise from elsewhere? That’s about the time people start getting shot at night and taking your own vehicle to work is ill-advised. I recently heard that even the swanky outdoor mall on the east side, there too, was beginning to see much of the same.

    Loitering leads to shoplifting, which leads to vehicular B&E, to muggings, to car jackings, to murders around the time the legit street gangs begin to show-up. I see people strapped at the mall, now-a-days, I don’t even say nothing because they’re clearly either perfectly sane given the circumstances or completely insane and looking for trouble – dark clouds gathering…

  2. Here in Las Vegas as most know we were hit pretty hard in mortgage collapse. We never fully recovered however I have noticed lately with the illegals now lining up for drivers licenses, More are coming & moving to town where all the shopping centers and malls are slowly going from top notch stores to Mexican named consignment and dollar stores. These are happening in areas where just a couple years ago were mainstream mall’s with Macy’s Dillards and JCPenney’s. These malls now look like they’re in a 3rd world country. So anyone with money is going to only 2 areas of town and I’ve seen a huge division. Not so much anyone in the middle anymore. Our neighborhood that we’ve been in for 15 years-we actually just left last year because crime & gang activity (which we never had before) has gotten so bad and we left for the same part of town where the upper-middle-class to upper-class is. We had to downsize to afford it but we’re here. So to wrap up I basically see the middle-class dying and two separate classes becoming even further apart. You can definitely tell what side of town you’re on now.

  3. I live on Social Security. In order to get this, I have to Direct deposit the
    money in a Bank account. When the banks close I am “all-done”.
    I am also a patient at the local VA. When I stop getting my medicine,
    I am DEAD !
    The very BEST chance I have is with Jesus Christ and Father God !
    Blessed be God Forever !

  4. I’m a Physician involved in work injury rehab. Along with most other health care people, I’m seeing insurance companies behaving as unethically and as aggressively as I’ve even seen in 35 years of practice. They are denying critical medications (e.g. the last patient I saw today who also sees a pulmonologist, had her lung meds denied which WILL, eventually, result in her death), many are denying all imaging for old injuries that can progress and cause deterioration in the future (forget about all that high tech medicine, the insurance criminals won’t allow it to be used on you or me; only on the super rich, Dick Cheney types); and they are taking more than 120 days on average to pay (the average used to be 60 days). Also i’m seeing more insurance companies pay with a credit card (very weird). All of this tells me that the crash is very near and the fat cats who own and run insurance companies are in the know and are preparing by cutting costs to the bone and witholding services, even critical services.

    Regarding real estate, I live in an upper middle class neighborhood that in the 15 years we’ve lived there before 08, houses were only on the market for a few days, always less than a week before they were sold. Now its months, and they appear not to be sold; rather it appears that the seller gives up and take the sign down. (this doesn’t keep the criminals running the city from raising the real estate taxes each year). Again an indication that not only are the poor and working class getting hit but so are the rest of us who are below the 1% billionnaires (which the vast majority of doctors are NOT, contrary to some ignorant people’s opinions).
    That’s my two cents worth.
    My diagnosis: collapse coming very soon.
    My prescription: lock and load.
    Wardoc

  5. I am in Vegas and yes this place was hit very hard by the housing collapse! I started traveling for work in 2010 and went to DC. I was amazed at how much work was there and how everything was fine. There are still properties here that are in ruins !! I am off work now for 6 months. Worked for the same company for 16 years but they are not building anything in Vegas anymore. My advice is prepare, save your money and get what you have out of the banks NOW !!!!!

  6. I’m excited about the new opportunities for the more productive among us in the emerging fields (pun intended) of Hemp and Marijuana. I really can’t feel bad for all those people working at Chinamart, they should have been helping America by developing useful skills instead of supporting communism. screw em. When your company can’t pay it’s suppliers maybe those employees need to go work for free in China to satisfy the debt. This seems logical and fair.

  7. For the past several years, the company I work for, shows up on this list of companies who plan to close a certain number of stores. Now I can’t speak for the other retailers (or officially, for mine either which is why I’m not using its name here) but there is an element that gets left out here.

    Like all corporate planning, there’s plans to close some and open some. How many new stores are planned to open in the coming year never seems to be part of this kind of article. In the past few years, my neck of the woods has seen a couple of new stores while closing a couple of others. Why? Many were old stores in neighborhoods that have changed so much demographically that they don’t float the corporate boat anymore. Others were leftovers from a merger with a former competitor, so when the lease runs out, you close one, save the cost of the store manager, lease cost and other costs of doing business, hire a few more part timers at the other one and still serve all the neighborhood. Many mall stores are being closed when leases are up due to the terribly high cost of mall leasing compared to strip store rent. Malls are usually a pain to work with on midnight opening sales as they have to guard all the other stores with security so they either charge a high use fee for the night, or simply don’t allow an after-hours event at all. When you’ve got your “own” place in an outdoor strip mall, you can open that door whenever you want.

    So there’s more to the story than meets the eye, at least some of the time.

    As for those who keep saying that digital downloading of electronic media will eventually replace all physical discs, I say phooey! A physical disc can last long past the useful life (and memory capacity) of your operating system. If you get tired of a game and its a download, you can delete it, but you can trade in a disc for some credit (depending on which retailer offers what services) toward your next otherworldly adventure. And with few exceptions, used are cheaper than new. (Think about games like used cars without odometers and it all makes sense) And, most people still like to be served by other people, have a place to meet and chew the fat and ask questions.

    Do I personally think the country is in trouble? Absolutely! Is all the above completely ‘bad news’? Not from my experience.

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