Retailers in bad financial shape

Retailers and Bankruptcy

It is no secret that the recession had hit non-necessity retailers the hardest.  As consumer disposable income decreased so did non-essential retailers profits.  With many factors such as online shopping, loss of niche markets and national discount chain stores, the following seven retailers may not be able to compete in today’s ever-changing economy.

1. American Eagle Outfitters.  American Eagle catering to teen oriented and early 20’s consumers have seen their profits fall along with its customers discretionary spending over the last few years.  Parents have also cut down on clothing purchases at American Eagle and other trendy stores such as Abercrombie and Fitch and Aeropostale.

2. American Apparel.  The hipster niche market retailer has brought on a new CFO, however, it is uncertain whether they can stay afloat if their customers aren’t making purchases.

3. BJ’s Wholesale Club.  BJ’s is a regional wholesale club relative to national chains such as Sam’s Club or Costco and is a prime position to be acquired by a larger chain.

4. Blockbuster.  With streaming the new rage and Netflix, On Demand, etc., Blockbuster may have run it’s course.  They filed for Chapter 11 Bankruptcy late last year, but will most likely fail.

5. Borders.  With e-readers, amazon, and ipads, the old fashioned bookstore, or mega-store may have run its course.  Borders filed for Chapter 11 Bankruptcy on February 16, 2011 and will close at least 30% of its stores immediately.

6. Radio Shack.  With online competition at a more attractive price, the savvy techies can find adapters, cables and other what used to be hard to find gadgets elsewhere.

7. Talbots. The over 50 target women’s retailer has failed to turn a profit and is focussing more on a younger audience, it is yet to be seen if the new, younger customer base will revive this Company.

Our economy is changing faster than ever and these companies are fixtures in shopping centers and malls, however, to survive, they too must adapt.

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