Business Chains That Struggled the Most This Year
Written by
Sean Fisher, AI Editor
Edited by
Sean Fisher
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The retail landscape in recent years has been a rollercoaster of ups and downs. As consumer behavior shifts and the pandemic’s aftermath continues to ripple through the economy, several business chains faced significant struggles in 2023. This article looks at some of the most notable names that have had a particularly challenging year.
Starbucks
While Starbucks is synonymous with coffee culture worldwide, it hasn’t been immune to the shifting tides of retail. The company announced plans to close 500 stores in the U.S. between 2020 and 2021, focusing more on drive-thru and curbside pickup options. The pandemic has accelerated a change in their business model, balancing closures with new openings.
Gap and Banana Republic
Gap Inc., the parent company of Gap and Banana Republic, has been grappling with changing consumer preferences and a shift towards online shopping. They announced the closure of 30% of their North American stores by the end of 2023, moving away from mall-based locations. This move reflects their strategy to adapt to a more digital-focused retail environment.
Godiva Chocolatier
The luxury chocolate maker Godiva announced the closure of all its North American brick-and-mortar stores by March 2021. The pandemic severely impacted their in-store foot traffic, prompting a shift in strategy to focus on online sales and presence in major retailers like Target and Costco.
J.C. Penney
J.C. Penney, once a staple of American shopping malls, filed for bankruptcy in spring 2020. Despite being rescued from financial ruin by mall owners Simon Property Group and Brookfield Asset Management Inc., the chain still proceeded with closing almost 30% of its stores.
Best Buy
Best Buy, despite a surge in online sales, announced plans to close at least 20 stores in 2021. The electronics retailer is focusing on staying agile and reducing the length of its lease terms, indicating more abrupt cuts could be on the horizon.
GameStop
GameStop, known for its vast network of gaming retail stores, has been in the process of closing about 1,000 locations by April 2021. Despite the gaming industry’s boom, the rise of digital downloads has impacted GameStop’s physical store sales.
Paper Source
Greeting card company Paper Source filed for bankruptcy in March 2021, planning to close at least 11 stores. The company had attempted to expand by acquiring shuttered Papyrus stores but ultimately succumbed to declining sales.
Kroger
Kroger, one of the largest supermarket chains in the U.S., announced the closure of several stores, including some in historically significant locations. The company is focusing on keeping prices low and operating sustainably profitable stores.
Foot Locker
Foot Locker plans to close 400 of its in-mall stores by 2026, shifting focus to more niche sports footwear markets. The retailer is rebranding and opening new concept stores that prioritize storytelling and presentation.
These business chains’ struggles reflect a broader trend in the retail industry, where companies are grappling with changing consumer habits, the rise of e-commerce, and the ongoing impacts of the COVID-19 pandemic. As the retail landscape continues to evolve, these businesses’ ability to adapt and innovate will be crucial to their survival and future success in the year 2024 and beyond.
Editor's note: This article was produced via automated technology and then fine-tuned and verified for accuracy by a member of GOBankingRates' editorial team.
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