The retail landscape is changing, and TJ Maxx and Marshalls, well-known for their discount shopping, are adapting by closing several of their stores across the United States. This decision mirrors a growing trend where shoppers increasingly prefer online purchases, leading to fewer people visiting physical stores.
These chains have succeeded by buying products in bulk to sell at significant discounts—a strategy that has been difficult to replicate with the same effectiveness online.
Store Closures
Earlier this year, the ripple effects of these strategic changes began to materialize. TJ Maxx closed its St. Paul, Minnesota, location, affecting 55 employees who were thankfully repositioned within other stores in the city, according to Axios.
January saw further reductions, with the Marshalls store on Exterior Street in the Bronx shutting its doors. This move led to the separation of 100 employees starting around January 10. Also, the TJ Maxx store on Fulton Street in Brooklyn wound down operations shortly after the holiday season, impacting 69 non-union workers. Economic factors were cited as the reason for the closures, though two other Brooklyn stores remain open.
In Chicago, the TJ Maxx at 1008 S. Canal Street closed on January 6. Having opened in 2014, this closure was part of a broader reassessment of real estate strategy.
Monica Crocetti, a spokeswoman for T.J. Maxx, said, “We are always assessing and reviewing our real estate strategies, and our decision to close this store reflects that thinking.” She also expressed gratitude for the continued support from Chicago shoppers and encouraged them to visit remaining locations in the area.
Industry-Wide Implications
The closure trend sweeping through TJ Maxx and Marshalls isn’t just their challenge—it’s a sign of wider strain across the entire retail landscape in 2024. According to a report by CBS, the retail world saw nearly 3,200 stores shut their doors permanently over the past year.
Even established names like Macy’s are not spared; they’ve planned to close about 150 stores within the next three years, slashing their physical presence by almost a third. Express, reeling from an April bankruptcy filing, is also trimming its portfolio by shutting 100 of its 500 locations.
Changing consumer habits are only part of the story when it comes to the current upheaval in the retail sector. Management missteps and a spate of high-profile bankruptcies have also taken their toll.
This year alone, businesses like Rite Aid and Rue21 have found themselves succumbing to financial pressures, significantly impacting their operations.
Perhaps the most dramatic scale-back has come from Dollar Tree, which announced plans earlier in the year to shut down over 600 Family Dollar stores. The company pointed to the dual pressures of inflation, which has heavily affected its customer base, and a rise in shoplifting as primary reasons for the closures.
In a conversation with CBS MoneyWatch, Neil Saunders, managing director of GlobalData, provided insights into the retail downturn. He explained that the wave of store closures hitting companies like Rite Aid and Rue21 stems from long standing financial challenges these companies have grappled with.
Additionally, Saunders pointed out that chains like Family Dollar are not just shuttering stores haphazardly; they are deliberately closing underperforming outlets as part of a concerted effort to streamline their operations.
This selective approach to closing less successful stores is becoming a prevalent strategy among retailers striving to navigate a market that’s becoming tougher by the day.
