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valunvesthere (23.01)

Opinions, opinions, and plenty of more opinions about retailers

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March 08, 2017 – Comments (3) | RELATED TICKERS: HGGGQ , JCP , SHLD

There are opinions that Amazon and e-commerce is the reason for all brick-and-mortar retailers woes. 

Sears has an Amazon problem it probably can't survive

Loads of J.C. Penney Stores Are About to Close Because of the Crushing Impact of Online Shopping  

 

There are opinions that Amazon and e-commerce is not the reason for all brick-and-mortar retailers woes. 

Opinion: Sorry, but Amazon isn't actually annihilating retail jobs 

 

Then there is the latest chain brick-and-mortar retailer announcing store closures. 

J.C. Penney to Close Up to 140 Stores

J C Penney Company Inc (JCP) Announces Closing of 130 Stores or More

 

Then there is more brick-and-mortar retailers closing stores. 

5 Other Large Retailers Besides J.C. Penney Closing a Good Amount of Stores

HHGregg closing 88 stores amid bankruptcy rumors

 

To top all of those above, malls will face declining traffic possibly due to big retail closures which many are traditionally anchors to malls, but to Jim Cramer due to online retailers and border adjustment taxes.  

Malls are going to become ghost towns, Jim Cramer says

 

My hypothesis of the recent brick-and-mortar retailers closures can be found when we did Calculus 1 in maximum and minimum value . Where if retailers minimize enough stores they will maximize profits and in straight answer minimizing operations to the point that profits are maximized.

3 Comments – Post Your Own

#1) On March 09, 2017 at 6:21 PM, notyouagain (42.45) wrote:

I was in a crowded, yes, CROWDED mall a few weeks ago. Strange how so many folks failed to get the memo that they don't enjoy getting out and shopping anymore. It wasn't the first time. And yeah, I do get it. Online retail is growing, but it is still a far smaller share of overall retail sales than bricks & mortar. And I don't think it'll ever catch up, either. Sure, it's growing faster now and probably will for some time. But its growth rate will eventually, sooner or later, start to slow down, then hit a ceiling at which point further growth will be hard to come by. Because most people are not a bunch of antisocial couch potatoes who never want to leave the house. Contrary to what all the Amazon fanboys think, most people like to leave the house and go shopping at physical stores and do more of their shopping that way than online. There won't be a flashing red warning light when online shopping is bumping up against its inevitable ceiling. There will be falling PE multiples as all the fanboys try to beat each other to the exit, though. I know. Reality sucks.  

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#2) On March 10, 2017 at 1:06 PM, Melaschasm (69.63) wrote:

Online retail will continue to eat up brick and morter retail. A huge amount of money is being invested in selling food online, because that is viewed as the really big piece of retail that is not doing well online. Personally I think there pharmacuetical sales is the low hanging fruit that Amazon should be targeting. The margins are huge and the brick and morter pharmacies are terribly inefficient. The one big challenge is to get patients to refil their prescriptions online, since they don't want to wait a few days to start taking their medicine. The end run that Amazon could provide would be same day delivery for Prime member's new prescriptions.

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#3) On March 10, 2017 at 2:23 PM, notyouagain (42.45) wrote:

Many states, or maybe it's actually federal laws, prohibit shipping some meds through the mail. Perhaps they can't be shipped via UPS either. Pain meds are too subject to abuse to risk shipping and must be picked up in person.

 

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