The "Matthew Effect" in the US retail industry is intensifying, and 50,000 stores will be closed in the next five years

It is learned that according to foreign media reports, a new study by UBS shows that a large number of US retail physical stores will close in the next five years, most of which are from small retailers, while the market share of large retailers will continue to rise.

Currently, the United States has nearly 1 million retail stores. A team led by stock research analyst Michael Lasser estimates that by 2028, more than 50,000 retail stores may close in the United States, accounting for about 5% of the total, which will also bring about a consumption gap of about $285 billion.

Vertical retailers are expected to see the most store closures, with apparel and consumer electronics stores expected to account for nearly half of all store closures. Meanwhile, home improvement and auto parts stores are expected to see the fewest store closures.

The Matthew effect of the strong getting stronger and the weak getting weaker is showing up in the U.S. retail market. According to a UBS report, over the past decade, large U.S. retailers have added 17,000 stores, while smaller retailers have closed 40,000 stores.

The study shows that due to rising operating costs and an increasing share of e-commerce sales, large retailers such as Walmart, Costco and Target are better able to absorb the impact of rising rent, labor and other costs and benefit from investments in the e-commerce market.

Smaller chains and independent retailers, with limited capital and less risk tolerance, are likely to continue their multi-year store decline. UBS analysts said that if sales growth slows below the long-term trend, small retailers could see higher store closure rates.

According to UBS, U.S. e-commerce sales are expected to rise from 20% of the retail market today to 26% by 2028. UBS estimates that nearly 25% of e-commerce transactions could be completed through in-store delivery or pickup.

UBS said that if annual U.S. retail sales growth falls below 4% in the coming years, the long-term historical average, store closures could reach 70,000 or more. Conversely, stronger sales growth would keep more stores open, analysts said.

Editor✎ Ashley/

Disclaimer: This article is copyrighted and may not be reproduced without permission.