Since the covid pandemic, underperforming stores and chronic retail theft have led brick-and-mortar retailers to close stores to ease financial distress.
Target (TGT) in October 2023 closed nine stores in four states because of theft and organized retail crime, after Walgreens in early 2022 and 2021 closed seven stores in San Francisco because of crime.
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Walmart (WMT) in 2023 closed 24 stores in 14 states and Washington, blaming underperformance and theft as central reasons for the closures. The retail giant decided to close a Walmart and a Walmart Neighborhood Market in the San Diego area on Feb. 9 after failed lease negotiations.
Retailers liquidate and disappear after bankruptcy filings
Retailers Christmas Tree Shops, Tuesday Morning and Bed Bath & Beyond all filed for Chapter 11 bankruptcy, liquidated and closed all their stores in 2023.
The latest retailer to fail is discounter 99 Cents Only, which on April 4 said it would liquidate and close all 371 of its stores in California, Texas, Arizona and Nevada. The company subsequently filed for Chapter 11 protection on April 7. (A former retail executive might be able to throw a lifeline to at least some of its stores.)
Rite Aid, however, has been closing hundreds of stores as a result of its bankruptcy filing.
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On Oct. 15, 2023, the drugstore chain filed for Chapter 11 protection, facing strong competition from CVS (CVS) , Walgreens Boots Alliance (WBA) , Walmart (WMT) , Costco (COST) , Amazon (AMZN) and investor Mark Cuban's CostPlus Drug.
The company, which listed $3.3 billon in debt, also felt financial pressure from a civil lawsuit filed against it by the Department of Justice in March 2023. The agency alleged that the chain's pharmacists inappropriately filled opioid prescriptions, contributing to the opioid epidemic.
The bankruptcy filing provides an automatic stay of any further legal action in the lawsuit. The company plans to negotiate a less expensive settlement, which could have amounted to more than $1 billion without the bankruptcy filing.
The drugstore chain on Oct. 17 initially filed a motion to reject store leases and close 154 stores, and in November and December it filed notices to reject 55 more stores for a total of 209. In late December and early January, it sought another 45 closures.
Rite Aid hasn't stopped at 254 closures as it has sought to close another 55 stores since Feb. 27.
Rite Aid closes more stores
Rite Aid in April filed three separate notices with the bankruptcy court seeking to close 53 more stores across the nation and another notice in February to close two stores.
The Philadelphia-based drugstore chain filed notices on April 2 to close 30 stores, April 3 to close six locations and April 9 to close 17 stores. The lion's share of closures are in California with 18 of the stores set to be closed. The closure list included 13 in New York, 12 in Pennsylvania, three in New Jersey, two in Michigan, two in Ohio, and one each in Maryland, Massachusetts and Virginia.
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The company had also filed a notice to close stores located in Michigan and Ohio on Feb. 27 for a total of 55 closures in 2024. That would bring its total store closures to 309, about 14% of the 2,100 stores that were open when it filed for bankruptcy in October.
