Have you noticed more “Store Closing” signs popping up at your local shopping center? Maybe your favorite grocery store has shut its doors, or the shelves seem emptier than before. If it feels like stores are disappearing at an alarming rate, you’re not imagining things. Across the U.S., retail chains—from big-name supermarkets to small neighborhood shops—are closing down, and it’s raising a lot of questions.
A recent example is Shaw’s Supermarket, which announced it’s shutting down two locations: one on Fort Eddy Road in Concord, New Hampshire, and another in Gloucester, Massachusetts. In a statement, the company explained, “Like all retailers, we’re constantly evaluating the performance of our stores. Closing a location is always a tough decision, but we’re focused on continuing to provide the products and services our customers value most.”
Meanwhile, the discount retail sector has also been struggling. In 2024, Dollar Tree revealed plans to close about 600 Family Dollar stores in the first half of the year, followed by another 370 closures over the next few years as leases expire. The retail crisis doesn’t stop there—Bargain Hunt, 99 Cents Only, and Big Lots have all faced mass store closures due to financial struggles and shifting consumer habits. In December 2024, Big Lots started going-out-of-business sales at its 1,392 stores in 48 states, highlighting the widespread struggles of the discount retail industry.
Rising Costs and Store Closures
One of the biggest reasons for the surge in store closings is the rising cost of doing business. Retailers are dealing with skyrocketing rent, increasing wages, and supply chain disruptions that have driven up the cost of inventory. Inflation has played a major role in making it harder for businesses to keep shelves stocked without raising prices to levels that drive customers away.
According to the Consumer Price Index (CPI), prices have risen by 2.8% over the past year, with food costs seeing significant increases. Essentials like eggs and beef have jumped even higher, putting pressure on grocery chains to either absorb the costs or pass them on to shoppers. Many chains, especially those that rely on budget-conscious customers, have found themselves struggling to maintain profitability.
Additionally, lease agreements are becoming a major burden. Many retailers are locked into long-term leases that no longer make sense financially, especially in locations where foot traffic has dwindled. This is why chains like Family Dollar and Big Lots have opted to close hundreds of underperforming stores to cut losses.
Changing Shopping Habits and the Rise of E-Commerce
Consumer shopping habits have shifted dramatically over the past decade. The rise of e-commerce, fueled by the pandemic, has changed the way people shop. More consumers are choosing to buy online, either for the convenience of home delivery or for the ability to pick up orders curbside.
In 2024, e-commerce sales accounted for nearly 21.2% of total retail sales in the U.S., according to the Census Bureau. This shift has put immense pressure on brick-and-mortar stores, especially those that haven’t invested in their online presence. Many traditional retailers are struggling to keep up with the convenience and competitive pricing offered by giants like Amazon, Walmart, and Target.
Retailers that have adapted—such as grocery stores that offer robust online ordering and same-day pickup options—have fared better than those that rely solely on in-store traffic. However, not all retailers have the resources to make these technological investments, leading to more store closings as foot traffic declines.
Increased Competition in the Retail Sector
The retail industry has become more competitive than ever. Discount chains, big-box retailers, and online marketplaces are all vying for the same pool of customers, making it difficult for smaller or mid-sized retailers to survive.
Retail giants like Walmart, Target, and Costco continue to expand their reach, offering low prices and vast selections that are hard for smaller stores to match. Additionally, dollar stores have proliferated across the U.S., with over 36,000 locations combined between Dollar Tree, Family Dollar, and Dollar General. These stores cater to budget-conscious shoppers, putting additional pressure on traditional supermarkets and local retailers.
When competition gets too fierce, underperforming stores often face closure. This has been a major factor in the downfall of chains like 99 Cents Only and Bargain Hunt, both of which struggled to compete against larger discount retailers offering similar products at lower prices.
Economic Challenges and the Impact of Inflation
The economic landscape has been challenging for retailers, particularly in the past few years. Inflation has driven up the cost of goods, utilities, and labor, making it harder for businesses to turn a profit.
In addition to inflation, supply chain disruptions have impacted store inventories, leading to product shortages and frustrated customers. The retail sector is still feeling the effects of the pandemic, with some businesses never fully recovering from the economic downturn of 2020-2021.
Higher interest rates have also made borrowing more expensive for retailers looking to expand or renovate stores. With capital harder to access, many companies have chosen to downsize instead, leading to increased store closures.
What Store Closures Mean for Communities
Store closures have far-reaching consequences beyond just the retailers themselves. Employees lose jobs, and communities lose access to essential goods and services. This is particularly concerning in rural areas, where grocery stores and discount retailers may be the primary source of affordable food and household items.
When large retailers leave an area, it can create a retail desert—an area where residents must travel long distances to access basic necessities. This disproportionately affects low-income communities, where transportation options may be limited.
In some cases, store closures can also lead to reduced property values and economic downturns in affected areas. When an anchor store in a shopping center closes, it can have a ripple effect on nearby businesses that rely on foot traffic from that store.
The Future of Retail: What’s Next?
Despite the challenges, the retail industry is evolving. Some companies are finding success by focusing on personalized customer experiences, unique product offerings, and enhanced digital services. Retailers that embrace technology—such as AI-powered inventory management, cashier-less checkout, and augmented reality shopping experiences—are positioning themselves for long-term success.
Additionally, some struggling retail brands have found new life through buyouts and rebranding. For example, after Big Lots filed for bankruptcy, Variety Wholesalers Inc. purchased 200-400 of its stores to keep them running under the Big Lots brand. This type of restructuring allows some stores to survive under new management, rather than disappearing entirely.
Consumers also play a role in shaping the future of retail. By supporting local businesses, shopping at brick-and-mortar stores, and advocating for fair labor practices, shoppers can help keep their favorite stores in business.
Conclusion
The wave of store closures sweeping across the U.S. is being driven by a combination of rising costs, changing shopping habits, economic pressures, and increased competition. While some retailers are struggling, others are finding ways to adapt and thrive in this rapidly changing environment.
Understanding these challenges is key to finding solutions. By staying informed and supporting local businesses, consumers can help shape the future of retail. The next time you see a “Store Closing” sign, consider the larger forces at play—and what can be done to preserve the stores and communities we value most.
