Retailing may well skip off the track for most of 2009, but I'm not ready to buy into it becoming quite the train wreck envisioned by some industry Cassandras.
Some experts are predicting another wave of bankruptcies and as many as 200,000 store closings. Alix Partners, a turnaround firm, said 26 percent of the 182 retailers with revenues topping $500-million face a high risk of financial distress in 2009.
But except for a couple of potential Chapter 11 bankruptcy candidates such as Pier One Imports, Borders Group and some department store chains, nobody's naming names yet. Meanwhile, a bevy of chains already joined Ann Taylor, Lane Bryant and Talbots in chopping new-store growth in half while stepping up closures of unprofitable locations in 2009. But the prospect of 150,000 to 200,000 store closings loses much of its punch when you realize retailers closed 151,000 stores in 2007 — the most since only 2001 — and opened 125,000.
That's because in addition to the ebb and flow of the economy and people's yen to spend, retailing has always been an around-the-clock scrum as some stores get hot and others go cold.
Bad times are when the least competitive get the boot.
Fact is, analysts in the 1990s predicted big-time store closings because the country had twice as much retail square footage as what they thought the population could support. Today it's grown to about triple, thanks largely to the popularity and relentless building binge of big-box stores.
In fact, that's one driving force behind many store closings today. Two holiday seasons after Wal-Mart got serious about selling high-definition TV sets and electronics, Circuit City skidded into Chapter 11 and Sound Advice vaporized.
Yet even with all these forecast closings, the retail vacancy rate is expected to rise closer to 13 percent this year, a few percentage points above where it is now. Hardly Depression era. It's a vacancy rate last seen in the bay area after the early 1990s recession and savings and loan crisis.
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Consumers Union, the nonprofit that publishes Consumer Reports, has acquired consumerist.com, the online advice and social-networking site. It's an attempt to broaden an admittedly stodgy, mature audience.
The seller is Gawker Media, which has been selling Web sites as its king of the blog-snark owner Nick Denton retrenches in fear of a deep decline in the banner ad market.
The price was not disclosed. But like Consumer Reports, which has 3.3-million subscribers and draws 30-million page views monthly to its Web site, consumerist.com, which gets 10-million page views a month, no longer accepts paid ads.
Mark Albright can be reached at [email protected] or (727) 893-8252.