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03/10/2014

Staples, RadioShack and Sony Announce Drastic Brick-and-Mortar Cuts

As disappointing Q4 numbers continue to be reported across retail three well-established retailers have announced large-scale store closings. Staples, RadioShack and Sony announced a combined 1,345 store closings last week, with even greater store closing potentially on the horizon.

Here is a quick look at the closings:

Staples. Staples announce that it could close as many as 225 of its 1,846 North American stores by the end of 2015. The proposed closings would amount to a little more than 12% of the office supply giant's current brick-and-mortar presence.

The company has been squeezed by the online competition and has seen its market share drastically reduced with the merger of Office Depot and Office Max. For Q4 2013 the retailer reported a 10.6% drop in sales — sales for Q1 2014 are projected to be down as well. The dismal financial forecast has produced a 35% plunge in stock price over the past two months.  

RadioShack. Despite an ongoing effort to turn its struggling business around, RadioShack announced plans to close as many as 1,100 stores. The number represents nearly 20% of the electronic retailer's brick-and-mortar sites, leaving the chain with around 4,000 remaining locations. The quadruple-digit store closings come on the heels of two consecutive years of closing 100 stores.

Net sales and operating revenue for Q4 2013 fell 20%, and same-store sales were down 19% year-over-year. The retailer will tightly monitor the performance of its remaining stores and is prepared to shutter even more stores if necessary.

Sony. Sony announced the closing of 20 of its 31 U.S. retail stores, amounting to over 60% of its total brick-and-mortar offerings. In addition to the 20 store closings, the electronics manufacturer and retailer announced that it will be laying off 1,000 workers by the end of the calendar year. An additional 4,000 are expected to be let go before the end of fiscal 2014.

Despite the raging success of the PS4, the manufacturer has struggled to keep pace in the crowded electronics segment. Earlier this year the company announced the sale of its Vaio PC division and the spin-off of its television business. The company's stock price has reduced by half over the past two years.

For related content:
Top and Bottom 5 Retailers of Q3 2013
RadioShack Localizes Shopper Strategies on Store-by-Store Basis
Staples CEO Outlines Shift Away from Store Footprint