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Author Topic: Are we witnessing the end of the American department store?  (Read 626 times)

RobbieL2415

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Are we witnessing the end of the American department store?
« on: March 31, 2020, 11:59:44 PM »

Macy's is being de-listed from the S&P 500 and moved to the S&P 600 Mid-Cap. They have suspended dividend payments.

JCPenny is trading at 36 cents, even.  That is officially less than the last day of trading for Sears Holding ("old" Sears), which was 36.59 cents.  JCP hasn't paid dividends in three years.

Both companies, and many more, have furloughed thousands of hourly and full-time workers.  Some, like GameStop, are now permanently closing stores.  With a quick rebound for the retail industry unlikely, I don't see any hope.

What do you guys think?
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Max Rockatansky

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Re: Are we witnessing the end of the American department store?
« Reply #1 on: April 01, 2020, 12:07:28 AM »

Don't we have a couple existing threads about this already?  You'll see some stores come out the back side of being consumed in the online retail crunch but it won't be many in 10-20 years.  What is the point of going to the store for clothes when you can easily order them online and get them shipped to you?  It definitely doesn't help many department stores are also being listed as "non-essential" right now.
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webny99

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Re: Are we witnessing the end of the American department store?
« Reply #2 on: April 01, 2020, 11:33:48 AM »

Yeah, I mean it's been a slow death over the past decade or so, and clearly coronavirus is going to drastically accelerate that trend in the short-term.
We'll see how much, if any, reversal there is to pre-2020 levels in the medium- and long-term.
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Re: Are we witnessing the end of the American department store?
« Reply #3 on: April 01, 2020, 12:52:17 PM »

What is the point of going to the store for clothes when you can easily order them online and get them shipped to you?

Depends on your definition of "easily". COVID aside, I much rather try something on in a store and find out it doesn't fit, then to have to wait for it to arrive, find out the online measurements were off, have to ship it back, and wait for a new one. Something that could take at least a week online could easily be accomplished in a day in-person. For someone who doesn't go clothes/shoe shopping very often, this is a huge PITA. There's also always going to be an "instant" need that will have to be fulfilled, e.g., my shirt/pants/etc went FUBAR in the laundry and I have an event tomorrow/very soon.

Other consumer goods, OTOH, (electronics, some tools, etc.), you have a good point.
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AlexandriaVA

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Re: Are we witnessing the end of the American department store?
« Reply #4 on: April 01, 2020, 01:18:12 PM »

No.

A lot of shoppers, particularly older people and people with relatively more time on their hands, will still want to be able to examine products in-person and make returns.
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hbelkins

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Re: Are we witnessing the end of the American department store?
« Reply #5 on: April 01, 2020, 01:24:04 PM »

I have long been a fan of Penney's, but their prices have gotten outrageous. Plus, with my weight loss over the last year, it's easier for me to find clothing elsewhere at more affordable prices, so I don't have to shop their big and tall department. Plus, they seem to have discontinued some of their store brands (Arizona Jeans, St. John's Bay khakis, etc.) that I liked.
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vdeane

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Re: Are we witnessing the end of the American department store?
« Reply #6 on: April 01, 2020, 01:39:20 PM »

Yeah, seriously.  I don't even understand why someone would even attempt to do clothes shopping online, unless they're looking for a replacement for something they've previously bought (and even that isn't foolproof).  It's very rare for me to be able to look at an item, pick a size, and have it fit.  Most of the time, I have to go through several sizes and items just to find one thing that works.  Just a few weeks ago, it took me two hours to find a pair of pants for work!  Everything was either too long or too tight.

I hope my local JCPenney store somehow holds on, but JCPenney had a lot of debt even before this.  It's too bad - it's one of the only places where I can find stuff that is both affordable and somewhat decently made.  Most places these days are either expensive or el cheapo construction.  Not sure where I'd go if they went away; I've heard Boscov's is decent (and doesn't have the debt problem... maybe they'll be able to expand more if other stores go under), but Colonie Center isn't as easy to get to as Crossgates, and they're not in the Rochester area, so if/when I move back I'd have to find somewhere else.
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TheGrassGuy

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Re: Are we witnessing the end of the American department store?
« Reply #7 on: April 01, 2020, 02:14:45 PM »

Appliances and electronics (i.e. GameStop), I can understand.

Clothes, no. At least not for a long time.
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triplemultiplex

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Re: Are we witnessing the end of the American department store?
« Reply #8 on: April 01, 2020, 03:57:07 PM »

Walmart and Target are a "department" stores, so the category isn't going anywhere.

The key is, they are also grocery stores.  30 years ago, they were (mostly) not, but they happened to pick the right time to muscle into the grocery game. So when a huge chunk of shopping moved online, they were prepared for the hits brick and mortar stores started taking.  Online grocery shopping has been a thing for a long time, but prior to this virus thing, most consumers were not down with having someone else pick out their groceries.  People like the ability to pick which fruit or slab of meat to drop into the cart and once we're over this thing, they'll want to do that again (I assume).

That's been the difference between Walmart and Target and other department stores like JCPenny or Shopko and why they keep expanding while the non-grocery department stores are dying off.

In one of the malls in Madison, a former Sears is now a Dave & Busters.  I think it says something about where we're going as a society.  This place that was once the stalwart retailer to get everything you need to take care of a home, decorate it and make your family look presentable ("adult" things") is now a Chuck E Cheese with beer.  A place for immature adults to pretend they're still 12 while chugging pitchers of Bud Light.
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briantroutman

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Re: Are we witnessing the end of the American department store?
« Reply #9 on: April 01, 2020, 04:55:16 PM »

Walmart and Target are a "department" stores, so the category isn't going anywhere.

Well...if you’re going to use the term “department store” that loosely, I don’t think this conversation is really worth having.



...examine products in-person and make returns.

I don't even understand why someone would even attempt to do clothes shopping online...

Clothes, no. At least not for a long time.

The responses seem to be focused more on the viability of brick-and-mortar retail more broadly rather than department stores specifically.

In one sense, true department stores have been gone for years. The elegant downtown cathedrals of commerce a century ago, which sold everything from glassware to pet supplies, were ultimately supplanted by frowsy suburban mall anchors selling a mix of 80-90% clothing and accessories (and of that, mostly women’s), plus a few linens, suitcases, and maybe some kitchen items.

As with other institutions which flourished in the mid 20th century by offering something for nearly everyone across a broad swath of middle class Middle America—General Motors, Howard Johnson’s, network TV—department stores’ place in society has been chipped away from all ends. Paralleling sit-down restaurants, the high overhead associated with providing illusory “service” is too costly for the most price sensitive segments of consumers. Those who do have excess disposable income have no interest in associating with what they perceive to be either downmarket or a dying relic of their parents’ generation.

Clearly, the current business shutdown will shake out many of the weakest players in the already ailing retail field, and I would not be surprised if companies like Macy’s and JCPenney either undergo massive contractions, exit the traditional department store space, or go out of business altogether. I imagine that some landmark stores (along the lines of Macy’s Herald Square) will continue to exist in some form, but I think a further retreat from the shopping centers of the country at large is inevitable.
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Max Rockatansky

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Re: Are we witnessing the end of the American department store?
« Reply #10 on: April 01, 2020, 05:05:55 PM »

What is the point of going to the store for clothes when you can easily order them online and get them shipped to you?

Depends on your definition of "easily". COVID aside, I much rather try something on in a store and find out it doesn't fit, then to have to wait for it to arrive, find out the online measurements were off, have to ship it back, and wait for a new one. Something that could take at least a week online could easily be accomplished in a day in-person. For someone who doesn't go clothes/shoe shopping very often, this is a huge PITA. There's also always going to be an "instant" need that will have to be fulfilled, e.g., my shirt/pants/etc went FUBAR in the laundry and I have an event tomorrow/very soon.

Other consumer goods, OTOH, (electronics, some tools, etc.), you have a good point.

Most normal clothing is now sold at general retailers which seem to be weathering the decline of retail much better than department stores.  The higher end stuff still seems to be mostly found in department stores or company outlets still. 
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Beltway

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Re: Are we witnessing the end of the American department store?
« Reply #11 on: April 01, 2020, 10:31:07 PM »

Clothing items like shirts and sweaters work when ordering online, and my mail orderings before the internet.  For me that is a standard size Medium.  For other folks YMMV.

I have never tried ordering slacks online... they needed to be fitted in person.
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Re: Are we witnessing the end of the American department store?
« Reply #12 on: April 03, 2020, 10:20:37 PM »

I ordered some chino pants online that were a clearance from Burlington Coat Factory, but even with the alterations, they were cheaper than what they normally would have been. Usually I'm not that lucky, especially since I have have pants with a 4" smaller waist size that fit looser than some of the "larger" pants I own.
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Re: Are we witnessing the end of the American department store?
« Reply #13 on: April 04, 2020, 04:37:02 AM »

Macy's is being de-listed from the S&P 500 and moved to the S&P 600 Mid-Cap. They have suspended dividend payments.

JCPenny is trading at 36 cents, even.  That is officially less than the last day of trading for Sears Holding ("old" Sears), which was 36.59 cents.  JCP hasn't paid dividends in three years.

Both companies, and many more, have furloughed thousands of hourly and full-time workers.  Some, like GameStop, are now permanently closing stores.  With a quick rebound for the retail industry unlikely, I don't see any hope.

What do you guys think?

Here in the Appleton, WI area, Fox River Mall, located along I-41 between College Ave/WI 125 and Wisconsin Ave/WI 96 in an unincorporated township area west of the city (opened in 1984), lost two department stores over the past couple of years (Sears and Younkers) and is left with JCPenney, Macy's and a Target.  During this current episode, only Target is open, the rest of the mall is dark.

I'm seriously wondering how much of the rest of the mall will answer the bell when the all-clear is given.

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Yes, I consider most malls to be 'soooooo last century' and I have not left any money behind in this one since at least the early 00s.

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