Ever since the first enclosed shopping mall opened outside Minneapolis in 1956, shopping malls have dominated retail. The mix of anchor stores including Sears, JC Penney, Macy’s and hundreds of smaller shops proved a winning combination. Serious shoppers could purchase clothing, jewelry, toys, books, Halloween costumes, and even major appliances from a variety of stores. Teenagers could go to the mall to “hang out.” Mall walkers could use the indoor walkways as exercise areas. The mall was the place to be.
These new shopping malls ranged from the humongous Mall of America in Minneapolis to the upscale Watertower Place on Michigan Avenue in Chicago to the local malls outside large cities across America. At its peak, there were more than 3,000 malls in the United States. Only 1,100 currently exist.
Anchor stores such as Sears. JC Penney, Carson’s, and Macy’s were critical to the success of the malls. They drew a large number of customers within the malls. The smaller shops benefited from the increased foot traffic past their stores. In addition, retailers often signed co-tenancy agreements in their leases with malls. These agreements allowed them to reduce their rent or get out of a lease if a big store closed.
Major department stores such as Sears, JC Penney, Carson’s, and Macy’s are struggling to stay alive. According to an article “America’s Malls Are Rotting Away” published December 12, 2017, “Sears, which had operated nearly 3,800 stores as recently as a decade ago, is now down to 1,104 stores. Macy’s closed 68 stores this year, and JCPenney was set to shutter 128.” Carson’s has recently announced it is going out of business.
What caused these anchor stores to fail? A number of factors contributed to the failures. Too rapid expansion. Changing habits of shoppers. Online shopping. Competition from Amazon.
Each story is different. For example, consider the story of Sears. This company had started out in 1888 as a mail order business. Using its famous Sears Catalog, it was able to reach potential customers in big cities, in small towns, and on farms across the United States. Sears sold everything from clothing to musical instruments to houses. Sears opened stores in large cities. By the turn of the century, it was the nation’s largest employer.
In the 21st century, things changed. Sears faced increased competition from companies such as Walmart and Home Depot. To raise capital, it sold off its Craftsman tool line, DieHard batteries, and Kenmore appliances brands. It sold off real estate of underperforming stores. According to http://money.cnn.com/2017/11/30/news/companies/sears-losses/index.html, “Sears, which had operated nearly 3,800 stores as recently as a decade ago is now down to 1,104 stores.”
To see a video about the changing face of shopping malls, go to “American shopping malls struggle to survive You Tube.”
—By Karen Centowski
You must log in to post a comment.