Montrose Retailers Need Your Help – Now More Than Ever

I found another article that is worth a read. It is alarming what is happening with retail businesses today. Many large corporations are shuttering hundreds of stores at a time due to the increase in online shopping. Small businesses like those in Montrose are feeling the pressure as well.

The good news is that we can help. By shopping local and supporting our local businesses we can help sustain the businesses in the area and keep the Montrose Shopping Park thriving. But we must do our part. We must shop local as much as we possibly can. Montrose is a beautiful place that we all enjoy and we want o keep it that way. Remember “Shop Local First.”

The following excerpt is courtesy of Paul R. La Monica @lamonicabuzz and CNNMoney (New York). “There is a retail bubble – and it’s bursting. America has way too many stores at a time when consumers are increasingly shopping online instead of at the mall. One retail CEO even compared the state of retail today to the housing bubble back in the mid-2000s. Urban Outfitters, Staples, Dick’s (DKS) and Men’s Wearhouse/Jos. A Bank owner Tailored Brands (TLRD) all reported disappointing quarterly results. Women’s apparel retailer J. Jill (JILL) went public on Thursday and found few interested shoppers. The stock fell – after pricing its offering below its expected range. Handbag retailer Vera Bradley (VRA) underwhelmed Wall Street too. RadioShack just went bankrupt. Again. And Sears (SHLD) continues to hemorrhage red ink.

“The story is the same for these and other struggling chains like Macy’s (M), JCPenney (JCP), Barnes & Noble (BKS), Victoria’s Secret owner L Brands (LB) and Target (TGT). Shoppers are more inclined to click and order than visit bricks and mortar. Amazon (AMZN, Tech30), of course, is the biggest beneficiary of this trend. Its stock is up almost 15% this year and is trading near an all-time high. The company is worth nearly $410 billion – almost double the market value of Walmart (WMT).

So, to quote King George III in Hamilton, ‘What comes next?’

“Many retailers may be forced to shut even more stores and bulk up on their online commerce sites and mobile apps. The head of Urban Outfitters (URBN) had a blunt, and scary, assessment of the retail situation earlier this week. During a conference call with analysts on Tuesday, CEO Richard Hayne compared the state of retail to the housing glut last decade that helped bring about the Great Recession. ‘Retail square feet per capita in the United States is more than six times that of Europe or Japan. And this doesn’t count digital commerce,’ Hayne said. ‘Our industry, not unlike the housing industry, saw too much square footage capacity added in the 1990s and early 2000s.

‘Thousands of new doors opened and rents soared. This created a bubble, and like housing, that bubble has now burst,’ he added. ‘We are seeing the results: doors shuttering and rents retreating. This trend will continue for the foreseeable future and may even accelerate.’ It already is accelerating.

“Staples (SPLS) announced more store closures on Thursday. It joins a growing list of big retailers that are shutting stores, which includes both Sears and its subsidiary Kmart, Macy’s, JCPenney and Abercrombie & Fitch (ANF). Electronics retailer hhgregg is closing many stores too after filing for bankruptcy this week. Wet Seal, American Apparel, Sports Authority and The Limited are closing all their stores after bankruptcy filings. Move over, Amazon: Here comes Walmart. Of course, not all retailers are bowled over by Amazon.

“Walmart, thanks in part to its purchase of e-commerce startup Jet last year, is starting to gain momentum in digital commerce. Shares of Best Buy (BBY) and Costco (COST) are both up this year as well, despite increased competition from both Amazon and Walmart.”

Upcoming events

June business mixer on Wednesday, June 7 from 6 p.m. to
8 p.m. at Wells Fargo La Crescenta, 3200 Foothill Blvd., La Crescenta.

“Home Depot (HD) and Lowe’s (LOW) are holding up nicely too. And it sort of makes sense. Builders are probably more inclined to buy plywood and other supplies at a big store than online. Children’s Place (PLCE) was also a retail standout, reporting results earlier this week that topped forecasts. The stock surged nearly 20% on the news.

“And there are several mall-based apparel chains that are still doing quite well, most notably fast fashion stalwarts H&M, Zara and Forever 21. But the dominance of Amazon is clearly taking its toll on the weakest links of the retail industry. So don’t be surprised to see even more store closures and bankruptcies. Moody’s said in a report this week that Sears, J. Crew, Payless and Gymboree were among 19 retailers that it considers to be financially distressed.” Shop local first!

Montrose-Verdugo City Chamber of Commerce: Your source for all things local! Our mission is to actively support and enrich the community, vitality and pride of Montrose, to help preserve the historic district and small town atmosphere, to promote economic stability and positive, productive relationships within Montrose and the surrounding communities.

Upcoming events

June business mixer on Wednesday, June 7 from 6 p.m. to 8 p.m. at Wells Fargo La Crescenta, 3200 Foothill Blvd., La Crescenta.

  melinda clarke