Many retailers said that they were happy with the results of the 2009 holiday season, but joy is relative. Bricks-and-mortar store sales were up 2% to 3% over 2008, by most estimates. But 2008 was one of the worst holiday sales periods on record.Stores did do a better job controlling inventory and keeping costs down in the fourth quarter of 2009, but none of that could entirely overcome low revenue in some cases. There will be fallout among the weaker retailers as they examine their results and decide what their prospects are for the first half of 2010.
%%DynaPub-Enhancement class="enhancement contentType-HTML Content fragmentId-1 payloadId-61603 alignment-right size-small"%% Foot Locker (FL) appears to be the first large retailer to decide that its sales are too weak to carry it through this year without a retrenchment. The company said it expects to have closed 117 stores in the fiscal quarter that ends Jan. 31, out of the approximately 3,600 stores it operates in 21 countries. CEO Ken Hicks said that the closings and some management changes will "enhance our competitive strength and leadership position now and for the long term."
Foot Locker's stated reasons for closing its stores feels a little bit thin. No retailer shutters outlets if it is doing really well. The company's stock has dropped from $25 less than three years ago to around $12 more recently.
Foot Locker's store closures won't be the last shoe to drop in the embattled retail industry.
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