GNC to Close up to 900 Stores, Cutting Mall Shops by Half
GNC plans to close up to 900 stores which may cut its mall locations in half.
As part of the retailer’s “store optimization” effort, CEO Ken Martindale said it’s likely the health and wellness retailer will end up closer to the top end of its original optimization estimate of 700 to 900 store closures, as a result of “current mall traffic trends.”
Sixty-one percent of GNC’s store base is located in strip centers, while 28% reside in malls.
“The negative trends in traffic that we've seen in mall stores over the past several years has accelerated during the past few quarters putting additional pressure on comps,” said Martindale. “As part of our work to optimize our store footprint, we're increasing our focus on mall locations. And as you know, we have a great deal of flexibility to take further action here due to the short lease terms we have across our store portfolio. It's important to note that our strip center locations are relatively stable from a comparable sales perspective.”
GNC is likely to reduce its mall store count by nearly a half, from a little over 800 stores malls today to 400-500, according to CFO Tricia Tolivar. Franchisees don’t have any stores in malls, she noted.