15 Biggest Retailers Closing Down Stores Across America — Millions Stopped Shopping

Name: 15 Biggest Retailers Closing Down Stores Across America — Millions Stopped Shopping
Uploaded: 2026-02-15T16:00:34.000Z
Duration: 54 min 17 s

The Impending Collapse of Major Retail Chains

Overview of the Retail Crisis

The current situation in retail is not a temporary slump but a structural collapse affecting major brands, with many expected to cease operations by 2026.

Warning signs include rising credit card debt at $1.2 trillion and foot traffic in shopping centers down by 30% compared to previous years.

Even discount retailers, traditionally seen as resilient, are now struggling under unprecedented pressure. This analysis will cover 15 retailers on the brink of collapse.

Foot Locker's Decline

Foot Locker appears busy but is closing over 400 stores, potentially reaching 600 closures next year due to changing market dynamics where Nike and Adidas sell directly online.

Sales dropped from $8.8 billion two years ago to less than $7.6 billion, with profit margins collapsing from over 6% to under 2%—a trend unlikely to reverse itself.

The company is investing in flagship store redesigns at an inappropriate time when borrowing costs have doubled and consumer spending has decreased significantly.

Carter's Challenges

Carter's historically felt secure due to consistent demand for children's clothing; however, U.S. birth rates have fallen to a record low of 1.62 births per woman, impacting future customer bases significantly.

Revenue peaked at $3.9 billion in 2021 but fell to about $3.3 billion, with operating margins dropping from double digits to barely above 6% amid rising costs for cotton and shipping.

Parents are shifting towards cheaper options from Amazon and Walmart, diminishing brand loyalty that once benefited Carter’s sales strategy while carrying over $1 billion in debt exacerbates cash flow issues as interest rates rise sharply.

Dollar Tree's Struggles

Dollar Tree was considered a safe bet during economic downturns but raised prices from $1 to $1.25, leading customers to notice and traffic slowing down significantly as their unique selling proposition vanished overnight.

Despite impressive revenue figures exceeding $30 billion, profitability has declined sharply with operating margins falling below 5%, compounded by theft costing over $1.2 billion annually and unprofitable locations proliferating across the chain post-acquisition of Family Dollar for $9 billion which resulted in numerous closures and operational drag on resources available for growth or recovery efforts.

JC Penney's Ongoing Struggles

After filing for bankruptcy in 2020, JC Penney has not experienced a turnaround; instead, it continues on borrowed time supported by private equity investments while reducing its store count from over 1,100 down to around 650 locations today amidst ongoing closure plans ahead.

Retail Challenges and Predictions for 2026

Declining Relevance of Malls and Retailers

Mall traffic remains significantly lower (25-35%) than pre-pandemic levels, with former anchor stores like JC Penney failing to attract customers.

Increased competition from Walmart, Amazon, and fast fashion brands is putting severe pricing pressure on private label clothing lines.

Kroger, the largest grocery chain in the U.S., faces razor-thin margins (1-2% net profit), making it vulnerable to economic downturns.

Economic Pressures on Grocery Chains

Labor costs are rising due to union contracts while grocery inflation is stabilizing, limiting price increases to maintain margins.

E-commerce competition from Amazon and Walmart adds financial strain as online grocery delivery remains unprofitable for Kroger.

With $20 billion in debt, refinancing at higher interest rates poses a significant threat to Kroger's cash flow.

Walgreens' Struggles with Profitability

Walgreens plans to close over 1,200 stores by 2027 amid declining profitability; operating margins have dropped below 2%.

The core pharmacy business is under pressure from reduced reimbursement rates while labor costs continue to rise.

Impact of Retail Theft and Debt on Walgreens

Retail theft has surged, costing Walgreens over $1 billion annually and contributing to store closures.

With more than $35 billion in debt, high refinancing costs are further eroding earnings as foot traffic declines.

The Quiet Collapse of Bargain Hunt

Bargain Hunt's business model relies on excess inventory from other retailers; however, both conditions are deteriorating rapidly.

After filing for bankruptcy, the company liquidated most locations due to unsustainable occupancy costs and plummeting foot traffic.

Changing Consumer Behavior Affecting Discount Retailers

Low-income shoppers prioritize essential spending over discretionary purchases like home goods, leading discount retailers like Bargain Hunt towards extinction.

Claire's Financial Downfall

Claire's has been struggling financially since its bankruptcy in 2018; it now carries over $1.5 billion in long-term debt tied to underperforming malls.

Competition from Online Platforms

The shift of teens towards online shopping platforms such as TikTok Shop and Amazon has severely impacted Claire’s sales performance.

The Decline of Major Retailers

Big Lots: A Cautionary Tale

Big Lots, once operating over 1,400 stores, is now facing significant closures and financial distress, with revenue dropping from $6.1 billion in 2021 to below $4.7 billion last year.

The company struggles with inventory mistakes and shrinking margins as consumers prioritize essential purchases over furniture and home decor.

With liabilities exceeding $1 billion and high refinancing costs, Big Lots' cash flow is severely impacted; a potential recession could be catastrophic for its survival.

Macy's: The Slow Death of a Department Store

Macy's plans to close over 150 additional stores by 2027, following the closure of more than 400 since 2015, leaving around 750 locations.

Revenue has declined from over $28 billion in 2014 to approximately $23 billion last year, indicating a steeper decline when adjusted for inflation.

High theft costs ($1.2 billion annually), aging customer demographics, and competition from online retailers are exacerbating Macy's challenges.

Saks Global: Luxury Retail Under Pressure

Saks Global emerged from the merger of Saks Fifth Avenue and Neiman Marcus but now faces over $9 billion in debt amid declining luxury mall traffic.

Wealthy consumers are tightening their spending due to rising credit card balances and mortgage costs; online competitors are gaining market share at Saks' expense.

The company's thin margins are further strained by high refinancing rates on debt; without consumer spending recovery by 2026, it risks severe financial instability.

GameStop: From Meme Stock to Decline

GameStop has closed over 1,000 stores since 2017 as physical video game sales plummet in favor of digital downloads that account for over 85% of purchases.

Despite attempts at reinvention through NFTs and collectibles burning cash without returns, GameStop’s revenue fell from a peak of $9.2 billion in 2012 to just above $5 billion last year.

With dwindling relevance and no clear growth strategy, GameStop may slowly fade away rather than face an abrupt bankruptcy.

Rite Aid: A Case Study in Extinction

Rite Aid has filed for Chapter 11 bankruptcy after closing hundreds of stores; it operates fewer than 1,700 locations today compared to its peak of over 4,600.

The company carries more than $8 billion in debt while experiencing significant revenue declines due to opioid-related lawsuits impacting its recovery prospects.

Rising operational costs combined with shrinking reimbursement rates have rendered many locations unprofitable; Rite Aid is effectively undergoing public liquidation.

Bankruptcy and Retail Decline: A Case Study

Joann's Bankruptcy and Struggles

The Fabric and Crafts chain, Joann, filed for Chapter 11 bankruptcy in 2024 due to over $1.6 billion in liabilities, marking a desperate survival attempt rather than a reinvention.

Sales have plummeted from over $2.7 billion in 2019 to approximately $2.1 billion last year, with inflation exacerbating the decline.

Rising costs are impacting operations significantly; freight expenses are up by 30-50%, labor costs have increased by double digits, and theft losses are on the rise.

Despite restructuring efforts, Joann still carries over $900 million in long-term debt, with high refinancing interest rates draining cash flow.

Forever 21's Downward Spiral

Forever 21 has been deteriorating for over a decade; it filed for bankruptcy in 2019 and closed more than 800 stores globally, now operating around 400 locations in the US.

Sales dropped from over $4.4 billion at its peak to an estimated $1.6-$2 billion last year, worsened when adjusted for inflation.

Competition from online brands like Sheen and Tamu is crippling Forever 21’s ability to compete on price while managing physical store costs such as rent and utilities.

Broader Implications of Retail Changes

The retail landscape is undergoing significant transformation due to rising costs, shrinking margins, increasing debt levels, and a shift towards online shopping.

Communities are feeling the effects of these changes through longer drives for essentials and closures of local businesses as national chains retreat.

This markdown file encapsulates key insights regarding the challenges faced by major retailers like Joann and Forever 21 amidst broader economic shifts affecting American consumer behavior.