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By Claire Dickey
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Department store giants Kohl's and Macy's have announced upcoming store closures due to underperformance.
Kohl's is set to close 27 stores across the U.S. in 2025, with Macy's set to close 66 stores.
Why It Matters
Kohl's and Macy's aren't the only retailers shuttering stores. There's been an uptick in retail store closures nationwide, with over 7,000 store closures in 2024—about a 57% increase from 2023, Quartz reported. Big retailers like American Freight and Big Lots experienced bankruptcies in 2024, increasing these numbers.
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Newsweek reported that Family Dollar experienced the highest number of U.S. store closures in 2024, followed by CVS Health and Big Lots.
"Price-sensitive consumers are looking for the best prices and finding them online," Deborah Weinswig, chief executive at Coresight Research, told CNN. "They have also lost patience with stores that are hard to shop, have out-of-stock items all the time, poor customer service and other issues, and they're deciding to shop elsewhere."
What To Know
Here's a look at the 93 Kohl's and Macy's store locations closing in 2025.
Kohl's Store Closures
Kohl's will close 27 stores across 15 states by April 2025. The retailer currently has more than 1,150 store locations and noted that "these specific locations were underperforming stores."
In addition to closing 27 stores, Kohl's will close its distribution center in San Bernardino, California.
Macy's Store Closures
Macy's will close 66 stores in Q1 this year as part of a larger strategy to close around 150 "underproductive stores" stores through 2026. The first set of closing stores is spread across 22 states.
What People Are Saying
Professor Anthony Dukes, a business expert at the USC Marshall School of Business, told Newsweek: "These closures reflect an on-going trend of consumers moving online and the digital infrastructure that continually makes this easier. Traditional brick-and-mortar retailers, like Macy's and Kohl's are figuring out how to offer something that's unique that makes consumers want to visit their stores. I expect these retailers to introduce services and options (e.g. personalized assistance) that shoppers cannot enjoy online."
Martin Qiu, an associate professor of marketing at Wilfrid Laurier University in Ontario, Canada, told Newsweek: "Big picture: Department stores as a major retail format have been around for more than a century. They experience a life cycle like anything in the world... Store closures for Kohl's and Macy's reflect a need to optimize their physical outposts in a challenging retail landscape. Both companies are likely focusing on more profitable locations and streamlining operations due to the following factors."
"...Online shopping continues to take market share and can have different formats rather than just a website or phone app. For example, people can buy things on TikTok or other social media as they do on Amazon. These platforms also cater to new generations of consumers."
Tom Kingsbury, chief executive officer of Kohl's, said in a press release: "As we continue to build on our long-term growth strategy, it is important that we also take difficult but necessary actions to support the health and future of our business for our customers and our teams."
Tony Spring, chairman and chief executive officer of Macy's, Inc., said in a press release: "Closing any store is never easy, but as part of our Bold New Chapter strategy, we are closing underproductive Macy's stores to allow us to focus our resources and prioritize investments in our go–forward stores, where customers are already responding positively to better product offerings and elevated service."
What Happens Next
In order to boost in-store sales, experts like Duke predict that some retailers may look toward niche offerings and experiences that can only be provided in physical environments.
Per the National Retail Federation's (NRF) annual forecast, "...Today's physical shops must offer immersive experiences that can't be replicated online and showcase brands' unique identities."
In general, Qui expects more retailers will close locations in 2025, in part due to the oversaturation of physical stores in certain areas.
"I expect more store closure[s], with an accelerated integration of online and offline (in particular, mobile) channels."
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