Retail stores have served their communities for decades, offering a wide range of products. Over the last few years, many of these stores have been vacated, leaving only empty shells. These store closures not only affect the people in town but also the community as a whole.
Economists Refer to the Situation as a “Retail Apocalypse”
Store closings in the United States are not limited to specific areas; they are occurring nationwide. The closings are happening in both impoverished rural areas and affluent urban areas, driven by a range of factors.
It Has Been Going on for Over a Decade
Many might think that closings began in earnest during the COVID-19 pandemic, but they started a decade earlier. Economists trace the beginning of what they call the “retail apocalypse” back to 2010, but the problem has ramped up over time.
Some Stores Have Been Hit Especially Hard
Certain retailers seem like perfect examples of the problem. Blockbuster Video was once a dominant force, having driven several mom-and-pop video stores out of business. The video giant’s collapse was so swift that a documentary, The Last Blockbuster, featuring the chain’s last store, was released in 2020.
Store Closures Are Creating “Pharmacy Deserts”
Chain pharmacies, which once drove local pharmacies out of business, are now struggling themselves. Over the last year, major retailers CVS, Walgreens, and Rite Aid have announced the closure of hundreds of stores.
This Affects Health Care Access in Rural Areas
All areas of the country have been affected by the constant closures of pharmacies, but none more so than rural areas. Rural areas are already underserved by hospitals, with some Americans having to travel for hours to access healthcare. The continued closings have only created a more dangerous situation for these people.
Other Services Are Also Hurt
It is not just hospitals and pharmacies that towns are losing, but also other essential services. Supermarkets and grocery stores have experienced several closures, making it more challenging for people to access food. People are also missing out on financial services as banks close their doors.
Target and Wal-Mart Are Difficult to Compete With
While hospitals can be scarce in rural communities, most of these areas do have a Walmart or Target nearby. These retailers, which now carry almost any kind of product, have driven many smaller retailers out of business. In some cases, these megastores have been able to mitigate some of the pharmacy closings by offering pharmacy services.
Lower-Cost Retailers Have Thrived
One group of stores that has performed well in this new business environment is discounters like Family Dollar. These stores are common in rural areas and provide essential items at low prices.
So Have Warehouse Clubs
With more people looking to stretch their dollars, warehouse clubs like Costco and Sam’s Club have been thriving. Shoppers have been more than happy to pay the fees associated with these clubs, as they save significantly by buying in bulk.
The Closures Crush Competition
Businesses operate to make a profit. These stores have chosen to close their doors since they don’t believe that it can happen in certain areas. With less competition, the people in these areas, many of whom are poor, face higher prices due to the lack of outside competition from other retailers.
Towns Need To Come Up With Repurposing Ideas
When a shop has closed and it appears that another business won’t be coming in to take its place, it becomes incumbent upon the town to figure out how to repurpose the space. Some have used it to their advantage, creating new community centers or affordable housing.
Shoppers Also Have Less Access
Shoppers in these areas not only stop benefiting from competition, they benefit from fewer options. Sure, they could always look for items online, but many people prefer to try items on in-store and check the quality of a product with their own eyes, and these shoppers are losing access.
Jobs Are Being Lost Without Being Replaced
Every time one of these stores closes, several employees lose their jobs. These numbers start to add up once firms decide to close hundreds of stores at once. Some of those individuals can find employment in other areas, while others will struggle to secure work.
The Decline Hurts Local Property Values
For the most part, stores that are closing down are leaving vacant buildings. That means commercial real estate firms are unable to fill their buildings, which leads to declining property values in the community.
Shoppers Are Looking to Foreign Products
When stores close and shoppers lose local options, they often turn to the internet for goods and services. This has led to the rise of ultra-low-cost retailers like Shein and Temu. Those Asian companies, however, are being threatened by Donald Trump’s tariffs.
The Towns Miss Out on Tax Dollars
Retail stores don’t just provide their communities with goods and services; they also pay taxes. When stores decide to leave a specific town, that town loses out on potential tax revenue, which can lead to cuts in other areas.
Closures Can Harm Town Pride
People are largely proud of their hometown and want what is best for their neighbors. Town pride can be crushed when multiple businesses fail within a town. Local leaders need to take the initiative to keep spirits up.
Social Interaction is Affected
An underrated feature of retail stores is that they provide people with opportunities for social interaction, both with other community members and the store’s staff. Doctors have said that the United States is currently dealing with a loneliness epidemic and that loneliness can have adverse effects on people’s mental and physical health.
Conclusion
Store closures have been driven by the rise of online shopping and the COVID-19 pandemic. The looming tariffs could continue to harm American businesses and lead to additional closures. Shoppers will need to be savvy and look for deals to stay ahead of the fallout.
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