The Retail Apocalypse

[AlbertC]

Wouldn't be surprised to see Macy's next on that list of troubled American retailers.

Macy's reportedly looking to use real estate to come up with cash during coronavirus pandemic

Macy's is looking for ways to use its real estate during the coronavirus pandemic to come up with cash, according to a Bloomberg report.

www.cnbc.com

Macy’s May Need A Miracle On 34th Street

Departments stores heavily reliant on the U. S. market need to find ways to create short-term liquidity to ensure the business withstands the current crisis of closed stores, excess inventory and a supply chain of merchandise ordered six months ago.

www.forbes.com

 

[ShonTron]

I'm going to miss the Queen Street Store, as much as it's been reorganized, and carved out for Saks and the failed WeWork hijack. But I would not be surprised to see it go down with the rest of the chain. Finally cashed in my points for a $100 HBC gift card; as soon as I get it, I'll order some clothes in standard sizes that I'll need replacing. Just in case.

In the GTA, I definitely see Woodbine Centre, Eglinton Square, and Bloor Street being the first to go. Possibly Centerpoint too. They are all close enough to other, better stores the chain should be focusing on.

 

[junctionist]

It seems like a seismic shift is happening in clothing retail with a lot of retailers disappearing. What I don't get is how online retail is apparently doing so well (aside from the temporary issues associated with the pandemic). I return more clothing and footwear items bought online than at a store. Inevitably, it doesn't fit well or doesn't look as good as in the picture online. I get the convenience, but time and money gets lost on shipping and returns. Plus, online shopping generates more waste in the additional packaging involved. It's quite unfortunate.

 

[pw20]

It seems like a seismic shift is happening in clothing retail with a lot of retailers disappearing. What I don't get is how online retail is apparently doing so well (aside from the temporary issues associated with the pandemic). I return more clothing and footwear items bought online than at a store. Inevitably, it doesn't fit well or doesn't look as good as in the picture online. I get the convenience, but time and money gets lost on shipping and returns. Plus, online shopping generates more waste in the additional packaging involved. It's quite unfortunate.

Online retail isn't doing well, it's just taking market share. A select group of players (Amazon, Target, Wal-Mart) have "figured it out," Amazon because they are digitally native, Target and Wal Mart because they had scale to start with. Direct to consumer online brands (Away, Harry's, Casper) are floated by VC funds, and are nowhere near profitable, and their multiples of what the market views them as worth (Vs. what they're actually worth is wonky). Legacy brands (J. Crew) are losing market share to new online brands (Bonobos) that are floated by VC funds or owned, in the case of Bonobos by WalMart).
Everyone is making less money on an order online than they did in-store, because to your point - lotta returns.

 

[Johnny Au]

Online retail isn't doing well, it's just taking market share. A select group of players (Amazon, Target, Wal-Mart) have "figured it out," Amazon because they are digitally native, Target and Wal Mart because they had scale to start with. Direct to consumer online brands (Away, Harry's, Casper) are floated by VC funds, and are nowhere near profitable, and their multiples of what the market views them as worth (Vs. what they're actually worth is wonky). Legacy brands (J. Crew) are losing market share to new online brands (Bonobos) that are floated by VC funds or owned, in the case of Bonobos by WalMart).
Everyone is making less money on an order online than they did in-store, because to your point - lotta returns.

Don't forget Casper's competitor Endy, which was later purchased by traditional mattress retailer Sleep Country Canada.

 

[AlbertC]

Reuters: Lord & Taylor mulls bankruptcy

Dive Brief:

• Lord & Taylor is exploring a bankruptcy filing, Reuters reports, citing unnamed sources.
• "The company is working through various options at this time and is declining to comment," a spokesperson from parent company Le Tote said in a statement emailed to Retail Dive.
• Those options include attempting to get relief from creditors and seeking financing, sources told Reuters.

Reuters: Lord & Taylor mulls bankruptcy

In early April, parent company Le Tote laid off most employees at both entities, just months after acquiring the iconic department store from HBC.

www.retaildive.com

 

[gabe]

None of these higher end store bankruptcies surprise me, i'm sure we will see Nordstrom and Saks on this list soon. these stores cater to the Gen X - baby boomers with disposable income. Times are a changing. Millennial's sureas hell don't have $600 to blow on a pair of jeans or a $300 shirt.

 

[WislaHD]

None of these higher end store bankruptcies surprise me, i'm sure we will see Nordstrom and Saks on this list soon. these stores cater to the Gen X - baby boomers with disposable income. Times are a changing. Millennial's sureas hell don't have $600 to blow on a pair of jeans or a $300 shirt.

I do wonder if they'll cling on to Eaton Centre and similar locations in Vancouver and elsewhere in Canada though. I think while domestic Millennials might not be spending $600 on jeans, there is a lot of foreign nationals in Canada with disposable (cash) income.

 

[gabe]

I do wonder if they'll cling on to Eaton Centre and similar locations in Vancouver and elsewhere in Canada though. I think while domestic Millennials might not be spending $600 on jeans, there is a lot of foreign nationals in Canada with disposable (cash) income.

And wealthy tourists, only in the downtown centres. But with the stores being shut down for 2 maybe 3 months or more and still paying sky high rents, this could really be the final nail in the coffin for a lot of department stores.

 

[AlbertC]

A cousin of mine from New York City works as a manager for an Italian high end retailer, which has also opened a location at Yorkdale in the last couple of years. Personally I don't see them surviving in either the NYC or Toronto locations. They even had a store at Aspen, Colorado that's been closed for some time now.

Separately, smaller boutique type high end retail in areas like Yorkville are also going to take a major hit.

 

[TheKingEast]

None of these higher end store bankruptcies surprise me, i'm sure we will see Nordstrom and Saks on this list soon. these stores cater to the Gen X - baby boomers with disposable income. Times are a changing. Millennial's sureas hell don't have $600 to blow on a pair of jeans or a $300 shirt.

Are you sure? They have $1500 to spend on a phone, CG jacket, etc. I do agree though that these expensive stores are in trouble. My mom likes em, but she has more disposable money than I do. I'm good with the outlets.

 

[gabe]

Are you sure? They have $1500 to spend on a phone, CG jacket, etc. I do agree though that these expensive stores are in trouble. My mom likes em, but she has more disposable money than I do. I'm good with the outlets.

They spend crazy amounts on phones and Nike type shoes. But they buy cheap H&M type clothing ( fast fashion) They will buy new clothing every season. I'm maybe more like your mom. I like quality over quantity. I like things to last, so most of my clothing comes from high-end stores. I can't stand cheaply made shirts. I buy Zegna, Bugatti, Etro, Lagerfeld, Ferragamo, at stores like Saks, Harry Rosen, Holt's..etc i would miss these stores if we lose them. You get a higher level of service you don't get at lower end stores.

I think these high-end stores really faild attracting the Millennial customers, and were in trouble long before Covid.

Dear Millennials: Fast Fashion Is Creating An Environmental Crisis And It’s Time You Change The Trend

Fast fashion is trendy, latest and affordable but it has created an environmental crisis. Milennials love this trend. It's getting popular but at what cost?

www.edtimes.in

 

[SunriseChampion]

Millennial's sureas hell don't have $600 to blow on a pair of jeans or a $300 shirt.

I have worked so hard over the last 20 years to get there....give me another year and I'll have made it! Mind you, I won't be spending any of that on shirts of any sort.

So, speak only for those millenials who studied flaky arts programmes in post-secondary and have no skills to show for it.

 

[WislaHD]

Are you sure? They have $1500 to spend on a phone, CG jacket, etc. I do agree though that these expensive stores are in trouble. My mom likes em, but she has more disposable money than I do. I'm good with the outlets.

Yeah well, once you factor those, the high rent in Toronto, uber riders rather than TTC, and your weekly night out, I am not sure there is so much disposable money left over for shopping at Nordstrom.

 

[AlbertC]

There will always be exceptions, but typically the coming of age of when the young person has to start paying bills, rent (mortgage), and/or paying back student loans, is when their mindset changes on how they spend. I remember when I was in my early 20's working my first full-time job, I'd frequently go for $10 lunches, maybe get a smoothy or bubble tea that would be another $5 or 6, and then often enough go for a drink after work here and there. Fast forward to current times before Covid, I mainly pack my own lunches and only order out on the occasional or social gathering.