Shoppers look for discounts on clearance sales at Party City in Stamford, Conn. July 3, 2023.
Tyler Sizemore | Albany Times Union | Hearst Newspapers | Getty Images
Store closures in the U.S. reached their highest level since the pandemic last year — and even more locations are expected to close their doors this year as shoppers' dollars increasingly go to some industry winners, according to an analysis by Coresight Research.
Major retailers including Party City and Macy'sclosed 7,325 stores in 2024, according to retail advisory group data. That's the biggest jump since US retailers closed nearly 10,000 stores in 2020, the year the Covid pandemic began.
So far this year, the number of closures continues to rise. Retailers have announced 1,925 store closures so far in 2025 – and that was only on January 10. The five retailers that have announced the most closures this year are Party City, Big Lot, Walgreens Boots Alliance7-Eleven and Macy's respectively.
The retail consultancy predicts that retailers will close about 15,000 stores this year, as some legacy brands shrink and file for bankruptcy protection, or as companies close their locations.
The striking figures reflect the large gap between retailers that are gaining market share and those that have lost ground. Amazon, Costco And Walmart have grown in size as consumers seek value and convenience. On the other hand, some smaller chains and specialty stores are struggling to keep their doors open or have been forced to downsize.
A spike in bankruptcies contributed to the high number of closures in 2024. According to Coresight data, there were 51 retail bankruptcies in 2024, up from 25 in 2023. Some of these, such as Party City, have the most closures in 2025.
Consumer spending has remained strong, but more of the dollars have gone to fewer retailers. According to the National Retail Federation, the industry's largest trade group, holiday sales rose 4% year over year to $994.1 billion from Nov. 1 through Dec. 31. That total excludes car dealerships, gas stations and restaurants.
That's roughly in line with pre-pandemic holiday spending, which rose an average of 3.6% between 2010 and 2019.
Specialty stores in particular are having a hard time: In December, discount chain Big Lots said it would close all of its stores after the company's sale fell through, days before The Container Store filed for bankruptcy protection. Fabric and craft store Joann filed for bankruptcy protection for the second time in a year earlier this month.
But it wasn't just specialty stores. The highest number of closures came from last year Dollar tree-owned by Family Dollar, CFS healthConn's, rue21 and Big Lots, respectively. Conn's, a home goods and furniture retailer, and rue21, a teen clothing retailer, closed all stores after the parent company filed for bankruptcy protection in 2024.
John Mercer, head of global research at Coresight, said competitive threats are to blame, not a drop in demand.
“Consumer demand may be high, but where is some of that increased demand going? Where is it being directed?” he said.
He said the retailers that are closing stores typically fall into three categories: they are closing all locations as part of a liquidation, such as Big Lots; closing many of their stores after filing for Chapter 11 bankruptcy, such as The Container Store; or shrink their footprint as they adapt to rapidly changing consumer preferences, such as drugstores Walgreens and CVS and the old department store Macy's.
Macy's, for example, is closing about 150 of its namesake stores nationwide by early 2027. The department store operator has closed about 50 a year since announcing it in early 2024. a limited number of stores that will be smaller, outside malls versions of the eponymous stores and new locations of the better performing brands, Bloomingdale's and beauty chain Bluemercury.
Some newcomers are cutting back on traditional retailers' sales, Mercer says. Coresight estimates that Chinese e-commerce companies Shein and Temu combined to generate about $100 billion in sales last year, with most of that coming from outside the US.
For example, more Americans are turning to sites like Temu for party balloons and storage bins, which may have contributed to the bankruptcy filings of Party City and The Container Store last year, he said.
Even a small percentage drop in sales can be a blow to retailers' stores, which incur high fixed costs such as leases and labor, Mercer said.
According to David Silverman, retail analyst at Fitch Ratings, some unique factors have widened the gap between store openings and closings. According to him, when a large retail chain like Macy's closes, this could also lead to smaller retailers leaving the store. As some stores in malls or strip malls close, they are also being replaced by fitness studios, urgent care clinics or apartments instead of another store.
He added that population shifts during the Covid pandemic were changing retailers' shopping patterns and shaking up the location of their branches.
“Most companies are not adding significant square footage and even companies that were adding a lot until recently, like the dollar stores, are rethinking their footprint,” he said.
Silverman said he expects more stores will continue to close than open in the U.S. as retailer growth comes from online sales and as larger companies take a larger share of the market. Some of these, like Walmart, add much more volume with one store than specialty stores get from the dozens of locations they close, he added.
Investors will soon receive an update on which retailers are performing better and worse. Most major retailers will announce their holiday quarter results starting in mid-February.
Some retailers including Kohl's and Macy's announced their own plans for store closures before reporting full quarterly results. Kohl's said earlier this month that it will close 27 underperforming stores by April and close an e-commerce fulfillment center in San Bernardino, California, in May.
There is some encouraging news for the retail industry, however: The number of store openings in the U.S. also accelerated last year to 5,970 – the highest number since Coresight began tracking store openings and closings in 2012. The company expects this to remain roughly the same in 2025, with an estimated 5,800 stores opening.
Last year, Dollar generalDollar Tree, 7-Eleven, Mexican supermarket Oxxo and Five below had the most store openings.
So far this year, the five largest retailers in terms of announced store openings in the US are Aldi, JD Sports, Burlington Stores, Pandora and Barnes & Noble, respectively.