Unless you're one of the biggest and most profitable retailers in 2025, chances are, you're looking at the year ahead with some trepidation.
The past several years have included some unique challenges for retailers. Nearly every CEO of a major Fortune 500 company has had something to say about how hard it's been since Covid, and how hard their teams are working to provide affordable and creative shopping experiences for the American consumer.
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"Customers are putting fewer items in their baskets but shopping more frequently," Walmart Chief Financial Officer John Rainey recently told investors, adding that pricier products, like "electronics, TVs and computers have been a tougher sell."
Customers are far choosier with their purchases nowadays, since life is more expensive.
The most recent Consumer Price Index for December, reported this month, shows that the cost of key staples and services was up by 0.4% overall. This puts the 12-month inflation rate at 2.9% — which is at the higher end of what analysts had foreseen. Most predicted the report coming in at between 0.3% to 2.9%.
Here's a look at how some of our core materials and services changed in December compared with the previous month:
- Food: up 0.3%
- Energy: up 2.6%
- Gasoline: up 4.4%
- New cars: up 0.5%
- Used cars: up 1.2%
- Apparel: up 0.1%
- Shelter: up 0.3%
- Transportation: up 0.5%
- Medical care: up 0.2%
- Medical Care Commodities: 0.0%
Compared with November 2024, the costs of every measured good or service rose, except for medical care commodities, which remained the same.
Big mall retailers have trouble
The struggle has been particularly hard for retailers associated with shopping malls. This is partly because interest in shopping at malls has dwindled in recent years.
Hurt partly by the popularity of online shopping, malls have suffered from lower foot traffic on average in the late 2010s and 2020s. But it's not just Amazon and Wayfair that are hurting malls.
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There are just more deals to be found elsewhere. Popular retailers like TJ Maxx and Ross Dress for Less operate primarily out of strip plazas. And outlet malls, like Tanger, have soared in popularity because the shopping experience — which is primarily outside — is more pleasant and less pricey.
Plus, malls charge retailers outsized amounts of rent for the privilege of being located there. Problem is that when business struggles, these retailers either pull up stakes and rent space elsewhere or they fold entirely.
Big retailer pulls up stakes
Such is the case with mall retailer Macy's, which has pledged to close 150 stores over the next few years in an effort to turn around business.
And now, Macy's-owned Bloomingdale's is closing up shop entirely in San Francisco.
The luxury mall retailer said it would leave the once-iconic Union Square shopping district location in the popular San Francisco Centre.
“We are saddened to confirm that Bloomingdale’s will officially close its doors in Union Square, San Francisco. This vibrant city has been home to the brand for nearly two incredible decades,” a Macy's spokesperson said.
“We are hopeful to be back to serve the San Francisco community in the future and look forward to introducing new ways to provide enhanced service to our loyal local shoppers.”
This was the last Bloomingdale's location within the city limits. It leaves just two other locations in the areas of Palo Alto and Santa Clara, respectively 40 minutes and nearly an hour south.
Bloomingdale's isn't the only retailer to leave the shopping area. Nordstrom departed the San Francisco Centre in 2023, after more than three decades in the hub.
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