Malls hold no interest for me whatsoever. There's nothing there worthwhile, other than employment. Malls have nothing: no libraries, no Good Cafes, no places to hang out, no parks, no museums, no zoos, limited live music, no outdoors. And the few things it does have: like some book stores and places to eat, are all engineered to get you in and out and back to the Mall's singular focus: Spend, spend, spend: shop till you drop mentality.
However, I do feel bad for the people that will lose their jobs over it.
Let's make towns have downtowns, with beautiful brick roads, scenic ponds with some ducks, perhaps a waterfall, some nice cafes, a lawn with benches, some parks, some nature, trees, live music, a library and museums. It's okay to have some retails stores sprinkled around here and there, as long as they're original, and not those mass market plastic selling behemoaths we see everywhere.
I'm not disagreeing completely, but your location might be influencing your answer. I live in the northern portion of the USA, we get freezing winters and blistering summers. Come mid-winter...I am not going downtown to walk around outside, we don't hang out outside (unless we are talking winter sports, and then FULLY clothed). In summer, there needs to be shade. Fall and spring, we get wet.
But really, it seems like you want a town with more parks.
Completely agree that weather makes a huge difference to how much you enjoy strolling outdoors over being in a mall.
My main complaint about malls is how _loud_ they are: visually and auditory-ly (someone please tell me what the right word is). Malls are crowded, adorned in bright, garish colors, filled with stale food court food smells. There is very little seating other than at food courts, water fountains are hidden far away in some corner, loud music plays almost all the time, or it's noisy because of all the people. In sunny Silicon Valley, parking is a nightmare but there'll only be one bike stand hidden in a 50 acre space. It somehow has all of the worst features of a busy bazaar with almost none of the good (local products, "authentic"-ness, ability to haggle etc). Just standing in a shopping mall stresses me out.
It's possible that the present state of the art of mall design ticks the boxes for the largest audience possible and I'm the weirdo.
I think it's just that the things you want don't translate into a good return on investment for the owners and so they don't get implemented. (i.e. customers would like them, but it would not translate into a increase in shopping large enough to actually justify the investment from the owner's point of view).
My wider (and a bit tangential/ranty) theory is that the most tacky, tasteless and lacking self-control customers are actually the most profitable, hence businesses generally tend to pander to them. It's just much easier to extract unreasonable amounts of money from someone who's unreasonable (an adult child basically) than from someone sensible and reasonable, so for example us techies are not the target for a lot of companies.
There's no way the returns on investing in making the mall a pleasurable place to hang out in the short term outweigh the costs, but if people depended on malls as part of their area's social fabric, I doubt they would be facing this kind of longer-term decline.
This is why it’s tragic to have the primary public gathering spaces be privately owned and controlled with little insight or accountability from the public, only accessible by car and therefore cut off from the rest of the community by an ocean of parking lots and wide pedestrian-unfriendly streets.
The mall only cares about ROI, and providing a nice space for someone to sit and read a book, play hide and seek, host a club meeting, or stage a free play has little obvious monetary value.
Whatever amenities are provided will be carefully balanced against direct extra spending they bring in, instead of abstract civic improvement.
This really depends on which mall you go to. The Mall of America is not far off of Disney's Epcot center in terms of the amenities it provides. The Galleria in Houston is almost a city unto itself. I remember seeing a bridal party walking through it once, I'm guessing there was a chapel or function hall inside. A typical mall in Tampa, Florida, or Salem, NH has less charm, but those areas aren't working from a high base to begin with.
In dense urban areas, malls tend towards the high end and can be quite nice. The Shops at Copley Place in Boston is fairly high end in terms of shops and the architecture is nice. The Westfield in SF is nice in my recollection.
People do depend on malls as part of their area's social fabric. That's more true today than when Mall Rats was filmed, even though it's less cool now. It's the social fabric itself, not just the malls, which is disintegrating. Suburbia was never economically sustainable.
This has been discussed here before, and seems to be a bit of a blind spot for HN. Imagine you live in a place where there's only one "mall" nearby: that's most of America (geographically speaking).
Not an answer to your question exactly, but to the whole premise: Gruen transfer [0]. We have a great TV show by that name here in Australia that deconstructs advertising.
I'm in eastern Canada and I agree with your weather statement. With 100km/h winds, -25C and 1m of snow it's not worth going out. I wish we had a subway system here and underground shops.
Montreal and Toronto have huge indoor shopping areas connected by subway, I suppose technically they are malls.
So, growing up in the midwest, there is a museum dedicated to the area. It's on Main Street in the biggest town in the area. It's basement, which is now just used for storage, was part of an entire underground Main Street. You can still see the storefronts with the big windows and such down there. Apparently it stretched along most of downtown, mirroring the above.
Similarly, and while I don't have links on hand, Japan (at least Osaka, Kyoto, and Tokyo) have major shopping centers right in major train stations. The train station itself seems to be a destination.
There are gyms (generally Konami health clubs), food and shopping, and gardens on the rooftop.
In Osaka it seemed like every available square meter was converted to retail space. Shopping arcades, train station shops, underground causeways lined with shops, traditional malls. The back alleys have back alleys, and they're all lined with shops -- often specialty shops. I found one shop devoted to display cases for otaku to show off their model collection. Another shop specialized in LCD signs you could use in the storefront for your shop. It was NUTS.
And yeah, the first time I saw a Konami gym my mind boggled. Is this how Snake stays in such good shape? Use promo code Up Up Down Down Left Right Left Right B A Start and get a 30-day free membership!
Yes and many people here, especially outside of the downtown / in the GTA, act like being outside for an hour is unbearable and that suburbs and cars are the only fix. They aren't.
Some weather can be worked around though. Some of Denver's more popular shopping areas are outdoor type malls. You just have to design them with the weather in mind with things like fire pits and heaters to use in the winter.
Denver gets very little precipitation so rain is something that generally is not an issue though.
Sure, they don't completely isolate humans from weather conditions but these solutions significantly improve the livability and prolonged usability of an urbanization, without burning bathtubs of gasoline to keep running.
Humans are not obliged to colonize every single corner of the planet...
To be fair, other places work with this issue. Ljubljana gets plenty cold and has a lovely downtown - one of the prettiest I know. However, it has very little parking (part of its appeal), meaning it would be illegal to build it in the US.
I think you could apply the same thing to an indoor area. Make it feel like a truly public place, with comfortable seating areas, buskers, pretty things to look at, more local products and less bland chains, and less pressure to buy stuff.
Spend, spend, spend: shop till you drop mentality.
If you think malls are only about consumerism then you've misunderstood a big part of their appeal for a lot of people. Young people and groups of friends don't go to the mall on their own. Malls merge consumerism with social activity - they're for people who enjoy shopping with their friends.
If that's not you then fair enough, but don't disparage malls simply because they don't appeal to you. If they disappear society will be worse for many, many people.
I'm not a sociologist, but my feeling is that malls are just a last resort place for young people to socialize that is unstructured and free of charge. That is: there isn't really anywhere else to go be with your friends without paying for the privilege, that isn't organized by adults (like school sports or church groups for instance). When I was growing up, we had the mall and we had parking lots, and the latter was only for the "bad kids". I get the sense that kids nowadays just hang out with each other online more as a replacement.
A recent video called “Why The Kids Need Stranger Things”[0] made exactly this point about the nostalgia of the Netflix series and how malls were a symbol of free-range kids[1]. Circumstances have changed so much that the creators assert Stranger Things could not be set in the present day.
The reason why free range parenting has gone down so much can be seen in the series.
There was a believable scene in which one kid bullied another into taking an almost certainly fatal jump into the quarry, and was only saved by paranormal means.
A world in which more free-range parenting is the norm inherently implies a world in which kids more often pay the consequences of their actions, which can be death or maiming.
We, as a society, do not seem to have a stomach for this, to the point where free-range parenting has been equated with neglect.
> There was a believable scene in which one kid bullied another into taking an almost certainly fatal jump into the quarry, and was only saved by paranormal means.
I watched it last night so it's fresh in my mind. It was paranormal events that setup this scene and made the bully go to such extremes to begin with.
It was also one of the worst, least believable scenes in the series. The fact that he was so willing to jump, the threats the bully was giving, etc. It was just weak writing in an attempt to create a dramatic reunion. When your 11 years old it takes some time to build up the courage to make a safe jump from something like a bridge, let alone a possible fatal jump.
It was believable to me because they had shown adults talking about people that had bragged to have jumped from there. I remember as a kid thinking that everything others bragged about was true and I was just lame. I totally see him thinking it would be no more dangerous than jumping from a bridge, just a bit scarier.
That's so weird. We in northern europe have no problem in letting our kids roam (Finland, but I presume the situation is similar in at least scandinavia).
I would guess that even in northern Europe there has probably been a substantial reduction of kids’ roaming distance and time spent unsupervised compared to 2 or 3 generations ago. This seems to be a worldwide trend (if not to the same extent in every place).
In the US one of the big problems is a culture of legal liability for every possible thing, and a general culture of fearfulness, excuse-making, and ass-covering instead of allowing moderate informed risks and dealing responsibly with the consequences. If you have too steep a slide, some kid is going to fall off and the parents will sue and bankrupt your town. If you let kids ride the bus by themselves, 1 kid in a million is going to get kidnapped and the parents will sue. Etc.
But there are surely other contributing factors: more families with 2 working parents (and more single parents) and in general less adults “hanging out” with an eye on their neighborhoods, a general degradation of community relationships and civic institutions, smaller family sizes (it’s much easier to chaperone 1 kid than 6), more middle-class angst about maximizing children’s future earning potential, more media attention on rare tragedies, communication improvements leading to less spontaneous social gatherings and more virtual socialization, increasing reliance on car transport and inaccessibility of unsupervised play spaces (especially undeveloped land), etc.
I think this is a big one, and not just rare tragedies but distant ones. 40 years ago you heard about the bad things in your village, now the 24 hour news cycle feeds a constant stream of fear from all over the world.
Yes there is a trend to 'protect' kids from everything. But in my country there is a clear counter-culture advocating agianst what they call 'rubber stone' society where everything is done to avoid possible danger.
There are now ads running on TV saying 'let boys be boys', let them climb trees, go out and explore etc...
We in the US didn't a few decades ago, either. Politicians and the media (with different motivations) deliberately creating false impressions of increasing risks mostly did that in.
I grew up in them Scandinavian countries, and my brother and I often spent the entire weekend outside out of sight from my parents. My earliest memory of that is when I was 7 years old.
I now live in the US and have kids about the same age.
The issue is not homogeneous culture or any other thing people with no brains come up with, but traffic density, at least in my case.
Where I used to live we could roam without having to cross dangerous streets. Where I live now, there's traffic everywhere and cars don't give a shit about people on foot, so my kids do not roam.
When I was a kid, we used to have vast areas to play safely. I just looked on Google Maps and the cross-country ski route we used to regularly take on weekends is 4 miles long. We had to cross ONE street. I used to bike about 10 miles one way, by myself, when I was a little older and keep on bike lanes the entire trip.
We also used to have large play areas in the backyard of every home I ever had. The bigger ones were the size of a typical New York borough block. We didn't have to leave our homes to get to a playground, or a park...we had one right outside of our door.
Obviously this sort of thing is easier to do / plan for when the entire country has less people than the city of New York.
My single greatest fear for letting my kid walk free when she's old enough to is that she'll be killed by a driver. This is compounded by the fact that as long as you say "Sorry mate didn't see you" it's OK to kill people with your car
(weird really - can you do that for killing people by any other means?)
My wife and I have semi-seriously considered moving to northern Scandinavia for both this reason and its comparative likelihood of remaining a decent (well, bearable, if only just) place to live in a clathrate-gun scenario.
There was a case not far from where I live where a driver turning right mowed down a 4-year-old child walking with his grandmother on a CROSSWALK. He wasn't running or anything like that, just crossing the street. The child died. They didn't even charge the driver. Fucking ridiculous. It was 100% the driver's fault. New York Times published an article written by the child's mother who questioned the logic of first of all call it an accident and second of all how the driver wasn't charged with anything, not even reckless driving.
I don't know how to change the mindset. A kid in san diego was killed in a bike lane while I lived there and everyone poured sympathy on the DRIVER, ffs, and blamed the kid for being there. It makes one weep, especially because people (Americans, at least) accept it.
Forgive me, but it seems that you're taking a common argument (X policy that works in Scandinavia won't work in the US because the US isn't homogeneous) and extending it to some sort of xenophobic dog-whistle (i.e. kids in the US can't roam because the US isn't homogeneous). Is there a more charitable way to interpret your comment?
Definitely an interesting point that children have less freedom today. But it's a bit of a stretch to say that this is what's causing the "safe space mentality". The narrator says the good old days of free range parenting led children to be more prone to questioning authority, which is healthy. If anything, you could argue that young people's assertion of their right to "safe spaces" is a form of rebellion in itself.
The video comes from FEE though, so it's obviously got a political bias behind it that explains it's opposition to safe spaces. People on the more socially conservative end of the spectrum don't seem to understand safe spaces and how they are actually a rejection of authority, rather than an appeal to authority. The notion of authority used is simply more subtle.
Some marginalised groups have made a very valid claim that there is a built-in hierarchy in many social norms that constitute acceptable behaviour in mainstream society. And that they tend to be on the shittier end of the deal in that hierarchy. Therefore, rather than acquiesce to the ordinary way of doing things and just accepting the negative effects of living in a world that doesn't value them as it does others, they have decided to carve out a space where they can assert their own version of what should be culturally acceptable. And they ask that others respect their desire for such a space and not enter it without also changing their behaviour and rejecting the toxic standard practices.
It's quite simple, it's like the cultural equivalent of libertarians trying to carve out a piece of land where they can keep the government out and live in their hyper-capitalist utopias. It's inherently anti-authoritarian. Anyone who goes into a safe space is voluntarily choosing to abide by its standards, no one is forcing them to.
As a person that just entered college and out of that time period, mall didnt do it for me because they are barren of things to do. There is nothing but things to buy and nothing of actual interest. I would rather go to a friends house and play games or watch a move at the theater than go to a mall because there is nothing there. The times when I went to a mall was because there was an arcade there that we would hang out at but that was the only point of interest. Other than that we would go elsewhere.
Yeah I should have used past tense. I don't think malls are cutting it now at all. But the "thing to do" there when I was young was to just with your friends without needing to spend any money, without any parents around, and in a busy enough place that you could get lost in the shuffle. Hanging out at a friend's house involves parents and going to the movies is expensive.
>Up to 80 malls across the United States enforce a curfew or escort policy for teenagers
I was still looking young in 2008 despite being well into my 20s and that's when I got IDed at a mall entrance. I was so annoyed/insulted by it I never went back to that mall every again. I can understand getting IDed at a bar, but not at a friggin mall.
Your story reminded me of when I went on a cruise for my honeymoon. There was a cruise employee who gave my new husband and me a stern warning about how we should not be on the cruise without our parents if we were under 18. (We were in our mid-20s.) So much of society today wants to keep people dependent on their parents forever, it seems.
I think it's more the case that roving gangs of teenagers put adults on edge. And for good reason. When you put 5 or 10 of the most conscientious teenagers together, collectively they're like a bull in a china shop.
Adults aren't much better, but they're much less energetic unless they've been drinking.
I think you misunderstand. Malls only end up as a social gathering spot when there's nowhere else to go. And even then, that only really appeals to teenagers who have nothing else to do. A mall would never be preferable to what was mentioned above, a downtown with brick paths and quality scenery/stores, etc.
Where I live it rains for 9 months out of the year (and is very hot 2 of the other months - we maybe get 1 month of nice outdoor weather a year). I'd much prefer an enclosed space. Though, let's be honest, I'd really prefer someone to just drop my purchases off at my doorstep so I don't have to deal with the weather at all.
We are only thinking of malls in the classic context.
For the last 10+ years many "malls" have been outdoor "areas" with shops, beautified walking paths, communal spaces, grocery stores, movie theaters, etc. Essentially miniature downtowns.
We have both these and the classic style mall here. Only 2 or 3 classic malls any more. However, they are all VERY successful. There were 7-8 and I've watched many die, or be taken over by distribution hubs, data centers (think big non-customer facing building)
We've had about 3-4 outdoor malls developed in the last 10 years. All are going strong, albeit they are new.
Never? I certainly prefer a mall over a nice outdoor space (which I have available to me) when it’s freezing outside with a sheen of ice covering everything.
In those places some malls are bustling with activity every weekend, others are shuttering. One of the most popular malls in Milwaukee, Wisconsin is in fact an outdoor "town center," a nomenclature I take issue with. https://www.bayshoretowncenter.com/
The sad reality is that much of America, particularly suburban America but even in cities, public gathering places are nearly non-existent. The shopping mall (or more recently, lifestyle center, Festival Marketplaces, etc) is the closest thing many have to the town square or decently appointed public park.
However, the mall isn't a public space and things a healthy society allows for - protest, hand holding, being different looking, aren't necessarily allowed in a mall.
Regardless if a mall is preferable in 100 degree heat or -10 degree cold, those other spaces are important for other reasons.
> Young people and groups of friends don't go to the mall on their own. Malls merge consumerism with social activity - they're for people who enjoy shopping with their friends.
I don't think this has been true, at least in the US, since the 1990s.
Especially since a lot of malls intentionally made themselves unfriendly to students in high school and college in order to cater more to young families and affluent people.
They are hoist on their own petard, because as it turns out, the young families chose the big box stores to save money, and the affluent people are not numerous enough or consumerist enough to support more than one mall in their town. That mall gets the Brookstones and Sephoras and Victoria's Secrets and the Apple Stores. The other malls are full of basically nothing but cell phone vendor kiosks and a food court, and they die.
Malls made an intentional decision to push shopping over social activity, and killed their appeal, because you can shop from anywhere by using your phone, and 99% of what you want comes from a combination of your grocery store, big box store (possibly the same as your grocery store), and online shopping. There is now no reason whatsoever to physically travel to any mall in the US. They have only lame chain restaurants, the Borders/Waldenbooks has been closed for decades, the good music store closed and only the corporate sellout store remains, the Radio Shack is gone, Sears left, JCPenney is kaput, but you have plenty of stores that sell "fashion" to teen girls, including the ubiquitous Express, Justice, Forever 21, and Hot Topic. So the mall is where your mom takes you when the clothes at Wal-Mart, Target, or Kohl's aren't good enough any more.
I think if malls had gone the other direction, perhaps by adding mid-size under-21 live music venues as anchors, they would not be falling apart today.
You touch on one of the key points toward the end. Many of the traditional anchor stores are dead or dying and there are very few newer candidates healthy enough to take their place.
At our local mall, there's a sign warning that under 18 aren't allowed without adults.
They also removed much of what would attract teens and that age group. And many of the "older person stores" are ridiculously priced. Amazon, Walmart online, Aliexpress, and others are cheaper.
Malls are full of expensive stuff, not very good stuff, and caters to nobody in particular.
I know for us, it's because "Payless Shoes" that has cheap size 15's is the only reason why. So we beeline in, and out.
Mall security is what is unsustainable. I'm old by HN standards gen-X and I grew up with mall security hating me. Now mall security has under 18 kids arrested, which is worse. The point is for decades of formative years "the mall is that place where they hate me because of who I am". So its understandable that now that I'm in their prime demographic (older, financially well off) that I have no interest in going there.
You'd have to be older than gen-x to remember malls favorably as a teen. The place to socialize is/was high school sports in (ahem, under) the stands, and darkly lit movie theaters. Since the 80s, which is a long time ago, trying to hang out at the mall will get you kicked out by rentacops or arrested.
Another problem is the dead mall death spiral has no backwards movement, can only ratchet toward death. The closest mall to me went 95% womens clothing stores a long time ago and is now on the march toward having its sixth athletic shoe store. Its a one way path to foreclosure, like a diode action only moving one way. I don't buy womens clothes, so other than taking my wife or daughter there, its already dead to me...
Its interesting that when I was a kid the mall provided the novelty of everything under one roof. Then big box stores happened and there is no appeal to lots of little box stores under one roof when I can just go to Target or Walmart. Walmart today is the early 80s mall of my youth.
I think you make a lot of good points. Not having grown up in the US, I don't have an immediate aversion towards malls. And as a guy who loves fashion, malls offer me a way to checkout a whole bunch of different styles, which is worth the slightly higher prices (at least for me anyways). Besides, they do have sales when the prices are somewhat better.
But even I have embraced online stores. Every major fashion brand has an online store, and its just much too convenient to order online rather than have to drive to a mall etc.etc. I would rather, read a book or hang out with friends over a beer.
Which brings me to an excellent observation you made: most stores in malls are reorienting to serve more women. I think women love the social aspects of shopping (i.e. trying out new clothes with friends and getting their opinions) as much as the actual shopping itself, which is probably why many women continue to go to malls.
I think Malls are missing out on some great opportunities to be entertainment centers. They get the footfall; instead of orienting towards selling shit, they should be trying to provide some kind of experience.
Also see the constraint on "mom is stuck with the kids" to this day even in 2017 etc. So a movie theater is a hard sell if mom has the baby in the stroller.
Of course going to the mall implies having money and a car, which means the library is accessible, so having story time at the mall merely replicates a service that's barely getting by somewhere else; better off just driving to the library or whatever rather than imitating it and splitting the participants such that possibly neither can be a success.
Indeed. I know it's changed a ton since I grew up in the '80s.
I remember Spaceport and Aladin's castle. .25$ arcades, and $1 gave 5 tokens. You could play for hours just on $5. And they allowed kids, competitions, and all sorts of things. I'd go hang out while my parents were shopping, and just chill.
There also used to be, in quite a lot of the malls, a jungle gym or playground area. They'd be full of kids, and you could just chill and hang out, except for free. But there were usually age limits so you didn't hurt little ones. And around this was always a common area. Lots of tables, food places, coffee shop or 2.
Clubs and nonprofits would meet here - it was a huge commons area. I remember fondly playing chess on chess club nights. Played some pretty awesome pros there.
And the companies there.. You had Sears, Estee Lauder, Nordstrom, and all those big name box stores. And then you'd have all sorts of smaller stores scattered, with rarely ever any room left over (1-2 empty plots due to eventual turnover). But there was something for everyone. Maybe it was a candy store, or a toy store, or specialty thing.
That's all changed.
Arcades are gone. Yeah, there's one 35 miles away from me, in the next city over. The jungle gyms and playgrounds were deemed dangerous and unsupervised, so they were decommissioned. You know, for "safety". And those tables? Yeah, those only encourage bums and lazy people to congregate, so they're right out.
And those clubs? Yeah, they need to pay rent if they want to have a group, so they too were summarily kicked out (Well.. it is private property :/ ). And now with less people, those food vendors started closing. That coffee shop had not enough customers and moved/closed. The rest of the food vendors (whom you've never heard of), now started skimping hard and jacking the prices.
And that's not to add in the compounding issues with online stores. A single online store can house millions of products. No real retailer can do that. So, you see the big box stores being squeezed by both the malls running people out, higher prices than online, and better selection than online. So, they end up closing and going bankrupt. It's not any one fault here, but a compound effect that set these things in motion.
For me, its that single shoe place. I make a point to park at the closest place to get in, try on shoes, and get out. There's nothing else here for me. And clothing is really the last bastion of something you really should be in person for - cause sending back stuff sucks.
In my town (Southern NH) the local Simon Mall actually solicits clubs. My wife's "Mom's Club" is offered freebies to host events there. E.g. they'll comp a photo package with Santa in the winter knowing that it'll get 30 middle-class moms in and shopping.
I wish our local mall would do that. I've asked, and they just flatly say no. They're already suffering pretty bad with quite a few storefronts abandoned. I think our paper said something like 20% are empty.
It'd only be a small amount of electricity used, and a bit of janitors they already have. They could pull in a few non-profit groups doing fun stuff (game club, moms club as you said, techie club, etc.) and drum up foot traffic and business. But given the doom-and-gloom article after article, I'm guessing they're looking for as many ways to cut costs as possible.
I figure our mall has a few years left. There's enough shops like "Lidz", candy stores, some weird smelly pet store, the usual 16-21 girly clothing stores, the goth store (spencers), a Target, and a few others. But the life's certainly being drained out step by step.
Go to a mall on the weekend and tell me. Maybe the malls are dying in dead cities, but they're booming in LA who already has plenty of mom and pop shops too. Both are thriving.
For many people malls are a comfortable place with free air conditioning during the summer months. Free internet also helps. I've seen McDonalds also serve a similar local function.
> Let's make towns have downtowns, with beautiful brick roads, scenic ponds with some ducks, perhaps a waterfall, some nice cafes, a lawn with benches, some parks, some nature, trees, live music, a library and museums.
You would think! I live in Santa Monica, California, and we have exactly that in our downtown area. The retail shop turnover is insane -- a large amount of shops come and go from the area, despite the massive amount of foot traffic the area sees every weekend (and most weekdays during the summer).
No... SM is a bit wack. The prices are so high, only big businesses can afford to be there. So most stores are big franchises. And it's too touristy for any culture. Main St is better, and towards Venice.
I would also nominate DTLA. Downtown is lit. Parking is wack though.
Consumers are no longer interested in old retail chains. They follow influencers and their original brands, but they're mostly direct to consumer, and everything arrives in two days anyway.
SM is loud and very touristy. Buskers are allowed amps for their guitars and I can't count the number of languages spoken. It's more of an airport terminal than anything approaching 'local'. God have mercy on you at the pier. I'd go Culver City, as a better 'local' kinda thing, but even then you need to get up to SB to really stand a chance of a quiet coffee on the street.
> Parking is wack though.
Literally all of LA is like this. Pro-tip, in SM, park at the library. Cheaper and easier to get in/out.
Even Beverly Hills has great parking. The major bottleneck downtown is parking right now and has been for a while. SM moved fast to build multiple parking structures... and that's where all the foot traffic comes from. Not sure why DTLA is so nonchalant about this. Don't see any construction whatsoever.
You don’t see any construction in DTLA? Are we both living in 2017?
It seems like every other day a new 40+ story mixed-use tower, with requisite parking structure, is breaking ground around here.
The thing that baffled me about downtown’s parking situation was how so many otherwise undeveloped parking lots managed to stick around given the opportunity cost of land downtown. That was until I realized a production crew can’t set up base camp in a parking garage.
> Not sure why DTLA is so nonchalant about this. Don't see any construction whatsoever.
Presumably because LA finally managed to make a section of the city livable and they don't want to hasten its demise. Parking has pretty massive costs for quality of life and the livability of a city.
LA is just in a weird transition point right now, where even a furious pace of transit building isn't going to remake the car-centric infrastructure overnight.
Third street promenade is a disaster area from the perspective you describe. It's a classical tourist funnel designed to extract the most from them.
As noted in another comment, Main St. is a bit better with some ok food, bars and coffee shops, but the retail side doesn't offer much. Most likely out of sheer need for survival due to super expensive lease rates, most retail is oriented towards tourists, with a little bit reserved for ultra wealthy of the area.
It's a tourist trap mall that looks like a downtown complete with a fair bit of mixed use residential+retail+commercial dense-ish developments.
The point that people overlook there is that the aesthetics—indoor mall vs outdoor pedestrian-friendly throughway through a central part of a town—don't actually matter nearly as much as thought, since if you went at 10AM on a Thursday you'd think it was just a nice little downtown with a surprisingly high amount of retail in a small town next to LA.
And there are definitely good cafes, parks, and a library, yet all you're seeing here is still just a lot of people complaining about it. So maybe those aren't the critical components the OP seems to think they are.
There's no reason you couldn't turn the space and structure of a stereotypical 80s mall into a different sort of organizing space, without a whole "we need traditional looking downtowns" push.
I concur. High foot traffic does not result in steady state retail om the local streets. I've lived in the far east and despite heavy mom and pop representation, the turnover is insane _and_ due to lack of aircon in the mom and pops, people flock to malls due to free aircon.
Aeon mall in Nagoya, Japan[1] was my primary daily grocery and pharmacy for years. Aeon's format is pretty much the same as most suburban American malls, but they seem to run a tighter ship and do a better job of vertical integration. (I used to marvel at how insanely mirror-clean the floors were in a place where probably a few tens of thousands of people tread daily.) Prices for things like groceries are not the lowest you can find in Japan, but they're good enough. They often have an area where you can buy local farm produce, a high-quality butcher, prepared bento, okashi, etc.
They have a good restaurant selection, too, with a not-depressing food court and a set of good-to-great restaurants. For families, the mall is still genuinely one-stop shopping for clothes, pet supplies, groceries, bikes, dining out, etc.
I often find myself missing my old, reliable Aeon when I'm abroad. I think malls like Aeon deliver on the promise that malls in America fall short on. Aeon is also the biggest retailer in Asia, IIRC.
The UAE is similar in that malls are very organized and controlled.
A typical mall would have a food court, a large arcade for kids, a daycare (or two), pharmacies, coffee shops, a book store, a furniture store, and so on. Also, unlike from what I've seen here in the US, any decent mall must contain a large supermarket (usually Carrefour). Malls in the UAE are therefore a "one stop shop" that people go to every week to buy groceries and household supplies.
Given how hot it can get over there, it makes absolute sense to have everything in one, air conditioned building.
In the US, that market has been taken over by Walmart. It is effectively the "one stop shop" that people visit weekly for everything from groceries to small furniture.
Now that I think about it, I wonder if Walmart has had almost as much of a negative impact on malls as Amazon and its ilk have.
An average Walmart is nothing like the malls I'm talking about. Heck, Carrefour itself already provides everything Walmart does, minus maybe the Walmart money and vision centers.
Imagine putting a Walmart inside of an average US mall. Now crank up the number of stores and activities to 11. That's how major malls in the UAE are like.
I wasn't meaning to imply that Walmart is "good", just that it would tend to suck the life out of similar ventures in the US. Its sort of like how Lowes and Home Depot effectively put Sears onto its last legs.
It isn't exactly that one is a substitute for the other, but one managed to effectively destroy the highest grossing businesses of the other.
Also, I've been in a mall in the US that effectively had a Walmart as an anchor. It was "interesting" and strangely it probably contributed to that mall's competitiveness in the area.
If you have been in a Target, then it's that but more run down. In Canada Walmart is equivalent to USA's Target quality wise. There is also zellers & kmart.
Yeah, but it really feels like they have gotten away from the original vision. I remember when malls had arcades (ok, and outdated concept in itself) and regular community events. But it seems like these don't produce enough revenue, so malls have optimized themselves into a revenue model that removes their natural appeal as a third place.
I think that malls could make a huge comeback with a focus on events that naturally draw people in and an emphasis on the kinds of high-touch products that people generally do prefer to buy in person.
> I think that malls could make a huge comeback with a focus on events that naturally draw people in and an emphasis on the kinds of high-touch products that people generally do prefer to buy in person.
Land prices in the cities where malls are developed have inflated past the carrying capacity of the prevailing disposable income in the same areas.
There have been some attempts, I guess. Dave & Busters seems to do pretty well, but these seem to be targeted at adults and the games are nothing like the old days, IMO.
I feel like the arcade concept could potentially be brought back, but it would require some creative thinking.
People have, there are many "barcades" in large cities around the US. As the name suggests they combine alcohol, food, and arcade/pinball machines (depending on the location I've seen free to play and token machines)
Yes, malls are all those things and I agree completely with your solutions, but malls aren't the worst - that, I'd say, are the drive-through mentality strip development stores that line suburban streets all over the US. At least with malls there's a semblance of people walking and interacting in person.
I feel like this is a sign of the times. Inflation has outstripped our disposable income that our previous generation has spent on consumerism or infrastructure to enable more consumption (malls, easy capital) and we are now reaping the rewards that our generation can't afford.
Malls are super fun. I loved hanging out with friends at the food courts and just walking around the mall going into Wizards of the Coast or Spencer gifts.
When you're 13 it's like one of the few places that large where you can hang out without parents around.
But yeah that was when I was 13. They haven't really innovated much. It's a great place for kids but no so much for adults. I thought almost everyone had a great childhood mall experiences haha, but I guess not.
Stanford Shopping Center and the Santa Monica downtown thing (I forget what it's called) are very close to what you describe.
What malls do have is space, and that kind of large space owned by a single entity is rare these days within a reasonable travel time away. Redevelopment potential is definitely there.
Also, a professor of mine once wondered why we don't have great public spaces like they do in Europe. Then he realized that we do -- in the form of college campuses.
Look at Stanford Shopping Center in the satellite view sometime: a bunch of rectangles surrounded by an ocean of surface parking.
It's much more like a conventional mall than a downtown: It's effectively walled off from the rest of the neighbordood. You're expected to go there by driving your car, and it's isolated by its massive parking lots so nobody would consider walking in or out a pleasant experience.
This is why I end up on University St all the time and almost never go to Stanford Shopping Center even though it's a bit closer, pleasant and I like a few of the restaurants/cafes.
What I would really like is for a few blocks of University to become pedestrian-only with lots of outdoor seating for its cafes and restaurants. (The same goes for other downtown areas in the South Bay, like Santa Cruz in Menlo Park.) It's amazing how little outdoor seating we have in the Bay Area despite the amazing weather.
Something like Forest or Hamilton Ave becoming pedestrian only would be great.
That being said, University Ave becoming increasingly "corporate blasé" in its selection of restaurants (basically great for a business meeting and little else) is sad to see.
That's true -- but it's a requirement of SV suburbia tbh. Density isn't high enough anywhere to support retail activity without a huge investment in parking, even in downtown MV or PA.
The personal vehicle oriented commutes exacerbate this.
Yes, but downtown Menlo Park, Palo Alto, Mountain View, San Carlos, hell, even Redwood City are the polar opposite of the Stanford Mall. The fact that a bunch of vendors of overpriced trinkets happens to have outdoor passageways is more a factor of the good weather of the bay area than it is an indicator of some kind of difference from your generic indoor megamall.
There's a difference between needing parking, and surrounding an area with a moat of parked cars.
I think one big problem retail is facing is that, for a long time, efficiency won the day. The chains and their supply chains and economies of scale drove more and more mom and pops out of business, and then only the really efficient chains could survive, and then they had to refinance and take on all this debt that the article mentions, and pretty soon there's absolutely nothing to mourn, and no reason not to buy from Amazon rather than drive to a Best Buy. Some truly unique independent mom and pop or local shops could be worth spending a few bucks more than Amazon to patronize. GenericMall stores give me 0 reason to patronize them over Amazon.
Malls reliably have enough parking. Getting downtown is a major (and slow) production, particularly if your downtown is progressive enough to intentionally deter access by car.
Santana Row has been fairly successful in creating a sustainable artificial "downtown" mall in suburban San Jose. No ducks or waterfalls, but they frequently have live music and the café is decent.
The other side of that is Santana row caters to high end buyers looking for high end brands that most malls won't carry. It's a bit of an edge case. They do have a Fogo de Chao though so that makes it cool in my book :D .
>However, I do feel bad for the people that will lose their jobs over it.
I'm not aware of anyone there--except maybe... jewelers?--that enjoy long-term careers at a mall. It's like an entire parking lot full of McDonalds. They'll find new jobs. Everyone at Circuit City managed to move.
And I'm in no way bashing retail or food worker. I used to tell people I did a "five year tour of duty at Sam's Clubs and I've got the [five year] medal to prove it." My point is that those jobs are both 1) crap working conditions and pay. and 2) easily transferable to comparable jobs at other employers.
Circuit City disappeared and the world moved on. K-Mart is still around but everyone who values their careers has already jumped ship. Block Buster is gone and the world keeps ticking. Mall store employees will continue on.
The real question is why no malls either care to, or are unable to, attract stores that appeal to customers. We are definitely becoming more hermit-like as a society, but there's got to be "something" most non-hermits enjoy. The whole purpose of the Mall is a bunch of stores that add value to each other by being near each other. "I bring Dad for a lawn mower, and the kids hit the arcade." (Man, I miss finding quarters and taking them to the arcades.) So my point here is, single stores still exist, so clearly it's not "stores in general" going out, but more "the stores malls want" people care less about.
>The real question is why no malls either care to, or are unable to, attract stores that appeal to customers.
No, the 'real reason' has nothing to do with shopping. The article touched on the actual problem. It is way too easy to get into billions of dollars in debt. If you own mall real estate, who do you want at your mall.
Small businesses that attract customers, but have to pay you with money they earn.
Or
Large chains that earn earn billions by playing leveraged debt games, and will pay stupidly high rates for rent, no customers required.
Malls will survive just fine, the moment rents and property prices are back in touch with reality.
I agree with you 95%. But 5% of me recognizes that certain items require a test run before purchase. In my case those would be Audio equipment, instruments and tennis rackets. None of those can be confidently purchased solely on the impressions of others.
And return them just as quickly. My wife will go through 4-5 online orders to find clothing that fits as advertised, returning a majority of each purchase.
Hard for anyone but Amazon to maintain that kind of return throughput.
I learned recently that even Amazon is banning people for returns. My first thought was that they must have returned a ton of products, but after a quick "banned from amazon" search online it showed that many people with a return rate as low as 9% have been banned. Which doesn't seem like a lot especially if we're talking about clothing. Here's one example, but there's plenty more if you do a quick search:
I don't know that it is for online purchases. My wife is buying clothes and shoes off Amazon lately and we are on our third return for one pair of shoes because their size guide online doesn't correspond to what they send us at all. That's a 200% return rate on a single item, and that's only if we get the correct one shipped to us this time. Non commodity items have turned into a major crapshoot online.
Online shopping has spoiled me for convenience compared to shopping in person though. What's happened is that I've just ended up not buying as many things because I was trained to expect convenance and then it was taken away
I buy on Amazon a lot and I don't think I return more than one or two things in a year, typically. Even buying shoes online (I usually use Zappos) I haven't returned that many.
Do you buy clothes or shoes? Ive never had to return toilet paper, but we got a pair of boots that were a different size from the listing when they arrived
Sure, to a degree, but these are different. And people that really care about clothes and/or furniture probably don't buy them sight unseen. For a lot of people, any good couch or shirt is probably good enough. But a guitar needs to be right for the individual. The difference between the right and wrong guitar can be significant, and is also something that will bother you every day.
Furniture is probably, next to a house and a car, among the most expensive things most people will purchase. And frankly I'm sure a lot of people just buy whatever guitar anyway, especially thinking back to the never-used one I used to have.
>> And frankly I'm sure a lot of people just buy whatever guitar anyway, especially thinking back to the never-used one I used to have
Surely you recognize that your mindset while purchasing that guitar was different than that of a serious musician investing a substantial sum in an instrument they'll play for thousands of hours.
I think the key point here is that that set is probably small for most people and also differs from person to person. Someone else might insist on trying their keyboard but be happy to buy a bike online. And that's before we take into account people trying out goods in-store and then buying them online.
I've, ironically, had the best luck lately with the small shops in the airports. They're much more willing to let you test their top-of-the-line headphones than any big box retailer.
Yes, to me, it is worth the slight price premium to reward that convenience.
I guess when people walk into an airport shop looking for headphones, they aren't just window shopping, they absolutely intend to buy a pair because they need it for the flight.
That could quickly change once people get fully accustomed to in-flight wireless: browse the web for a shortlist on the first leg, feign interest at the stopover shop, price-compare and commit on the connecting flight.
The logical consequence would be manufacturer stalls replacing shops in the waiting areas (like a permanent trade fair) and Amazon adding pick-up warehouses to the exits.
Malls should transform into upper levels for residences and lower levels for businesses and relaxation. landscape all the parking down to a decent size business parking for those in the mall and separate parkign for residents.
no reason failing malls cannot be remade into such. It has been done and no reason they cannot be a hub for such.
but as mass transportation and cars whacked mom&pop stores so the internet reduces the needs for boutique type stores and small chain merchandise oriented stores.
I'm not going to defend malls, but clearly there needs to be some kind of market place where people can encounter things they don't expect. We are already experiencing a media landscape with a filter bubble. Views become more narrow and extreme. You are going to need to have a place where you see things you think you wouldn't buy or want, otherwise your experience of world is going to get more narrow.
Amazon is extremely good at that, and they have a strong financial motivation to do so.
I'll agree with and extend your remarks on a tangent that at one point in human history literacy was nice but not required to participate in the economy. Currently shopping by catalog and spec and datasheet is for the cognitive elite like engineers, but soon enough its going to be a required new higher minimum of economic participation. You'll pick out your next bicycle by reading technical manuals and holding a ruler up to your leg, or you'll fail miserably at buying a bicycle. Just like its sad that illiterate or innumerate people get screwed in todays economy, people who can't shop like an engineer are going to get screwed in coming decades. What you're looking at is evolution of the economy to increase income inequality as it always does and increase specialization as it always does and require more work out of people as it always does. There's nothing really new about it, its just people who can't shop like an engineer are just not going to be able to shop anymore, at least not successfully, just like someone illiterate has a rough time shopping today.
> Currently shopping by catalog and spec and datasheet is for the cognitive elite like engineers, but soon enough its going to be a required new higher minimum of economic participation.
Sounds like you you're mistaking "wealthy people" for "the cognitive elite"! The shopping behaviors you're describing are just those of people who have either the time or capital to spend trying to get marginally better stuff.
> [...] soon enough its going to be a required new higher minimum of economic participation. You'll pick out your next bicycle by reading technical manuals and holding a ruler up to your leg, or you'll fail miserably at buying a bicycle.
I don't know what kind of bicycle shopping you're envisioning, but it sounds pretty damn weird to me. It's kind of hard to buy a bike that just doesn't work at all for most people. Even if your bike is several sizes off, it's just going to be more obnoxious to pedal. I'm in Boston, and I see tons of people commute around on bikes which really don't fit them at all and they do just fine. Even the crappiest bike is leagues better than walking
Also, I don't know how many people currently buy their bikes online who aren't already really into cycling vs people who buy them used or at a brick and mortar store, but I doubt it's high compared to, say, clothes.
[Edit]
> Just like its sad that illiterate or innumerate people get screwed in todays economy, people who can't shop like an engineer are going to get screwed in coming decades.
The type of shopping behavior you're describing is a luxury of the rich, not a necessity for most people. If you were to say, "not-wealthy people will be screwed over in the decades to come" I'd agree and point out that that's already the case.
> Sounds like you you're mistaking "wealthy people" for "the cognitive elite"! The shopping behaviors you're describing are just those of people who have either the time or capital to spend trying to get marginally better stuff.
This is a pretty odd assumption. Why do you assume that doing your research means valuing money _less_?
If anything, I would assume the opposite. I grew up lower middle class with a scholarship to a school full of upper class kids, and doing my research usually meant getting the best value for my money : when you have lots of money, it's often easier to just throw a bunch of money at the most commonly purchased product perceived as luxury instead of spending your time doing research on which provides the best value.
There’s a big difference between comparison shopping for prices and the type of shopping you described with your bike example. The former is something that everyone who’s remotely frugal does, and the latter is something that people who want to get The Best Thing (ie not out of necessity) do. That research to find The Best Thing takes a whole lot of time and energy, and lots of people just don’t have that.
Your bike example doesn’t really make much sense, because for the vast majority of people, the cheapest bike will do. Most people don’t bother measuring themselves first, and there’s basically no need to do so at all.
[edit]
To clarify: I don’t think that doing the type of research you described on a thing you’re buying means you value money less, but that it means you probably aren’t shopping for that thing out of necessity.
I think we're crossing signals WRT I'm talking about engineers shopping like the guy using a parametric search and examining some data sheets to find the correct resistor for a circuit, vs you're thinking I'm talking about engineer as a proxy name for well paid individual, which is admittedly usually true. There is a moderately high minimum required cognitive level to successfully use search interfaces and study what the component data sheets say, and do not say, about a device, vs the requirements of the design, combined with a bit of buyer beware ("hey, it says right here on page 7 of the engineering data sheet that this little surface mount resistors maximum voltage rating is 200 volts so using it as a bleeder resistor in a switching power supply is kinda all your fault...")
I think you’re assuming that the cognitive requirements for being an engineer are somehow higher than what most people can meet. I don’t think that’s true, and it seems like an extraordinary claim to make.
Isn't a walkable commerce area suitable? I've lost count of the number of stores I've wandered into, mostly because I live in one of the most walkable parts of the country.
>Malls hold no interest for me whatsoever. There's nothing there worthwhile, other than employment. Malls have nothing: no libraries, no Good Cafes, no places to hang out, no parks, no museums, no zoos, limited live music, no outdoors.
Which makes sense, as their main purpose is to be places to shop for clothes, electronics, kitchenware, and so on, not any of those other things.
I agree with you but when I go to the malls in Santa Clara and San Jose (they have food courts close to where I work at times) the malls are surprisingly crowded with usual suspects of teenagers/mothers with children/older possibly retired people/people like me.
I've noticed when traveling, in smaller to medium sized cities there may be a failed mall; sometimes these failed malls become great community centers, until the owners noticed they have traffic and wreak it. So stupid.
There are two problems with downtowns, in a tiny city, giant city, whatever.
First of all downtown already has a purpose which is to extract middle class home equity, run it thru the retail and restaurant wringer where 95% of businesses fail in the first two years or whatever. Its easy for the city to run downtown; the city doesn't have to worry about parking, for example, because those businesses are designed to fail and new suckers appear as fast as home equity loans can be sold so they don't need parking for businesses that don't have customers LOL. This also becomes self fulfilling, downtown is for dead businesses so why would I go there unless I had to because by definition the businesses downtown suck or they wouldn't be downtown where businesses go to die?
Secondly the downtown has drunks, criminals, crazy people, panhandlers, drug addicts in various state of withdrawl, buskers, homeless, and many/most cities are constrained to the light touch, which is nice for those folks, but also means nobody wants to go there. Crazy people have to go somewhere, and downtown has the church mission and a park by the river and a liquor store for self medication. I'm not even remotely interested in hanging out with those people, so I'll go to the Target at the interstate exit instead, or more than a generation ago I'd have gone to a mall where security is at least not non-existent. Your example of a park bench will have a homeless person sleeping on it, the scenic pond will have a drunk peeing in it, the cafes nobody wants to sit at because of aggressive panhandlers and the smell of excrement from the streets and alleys... You're asking for the whites-only exburbs where the average sales price is above $800K to keep out the riff raff that's 30+ miles out of town, I live by those places and they're cool but unachievable for 90% of the population. I live in the 3rd richest suburb in my metro area and even here our downtown is dying, getting overrun. The economy of the future is clustered around interstate exits not some arbitrary place where a railroad put a depot 150 years ago.
I don't know where you are getting the idea that people are congregating around interstate exits now other than your personal experience. Car ownership has been trending down in the US for a few years and the urban population as a percentage of total population has also been growing for a long time.
Most of the “urban” growth is in suburbs though. According to the census bureau myself and my two neighbors on a collective 70 acres of land live in an urban area. True urban core growth is mostly in a small number of places and a narrow demographic.
same with airports - just why do we need sooooooo many shops right next to the terminals? I understand travelers might need some basic stuff (food, water etc) but why other crap, especially so close to the terminals? no wonder airports are so huge
There's a lot of downtime for travelers, so shops are a good way for airports to make money, and for travelers to relieve boredom. The airports aren't big because of the shops, they're big because the planes and tarmacs need tons of space.
Walmart and Target are mentioned in the article and described as having more space than they need. Much of this is driven by improvements to logistical infrastructure over the past three decades and an increased understanding of what to do with customer/supplier/inventory data and improved capability when it comes to doing it. The recession provided them with the opportunity to remerchandise their stores from depicting abundance to depicting scarcity...it was always the case that Walmart might not have a particular item in stock, now the shelf is sparse rather than filled with one of ten other similar items that are older.
But in the US retail has been overbuilt for decades because the tax incentive of passive loss fueled construction until the Tax Reform Act of 1986. It helped precipitate the S&L crisis. Low interest rates helped overbuilding recover by making real-estate development more attractive and creating higher relative returns from real-estate investment.
The politics of lower taxes over the past forty years has made local governments more dependent on sales tax for funding. Because sales tax increases tend to be more politically palatable due to their regressive nature, local governments tend to be very much in love with retail. The love manifests itself as ready approval of new retail development and an even greater aversion to downzoning existing obsolescent retail parcels and broadzoning existing retail zoning districts.
> The root cause is that many of these long-standing chains are overloaded with debt—often from leveraged buyouts led by private equity firms. There are billions in borrowings on the balance sheets of troubled retailers, and sustaining that load is only going to become harder—even for healthy chains.
Oooh, I am so happy if this really happens. The entire financial industry that makes "profits" from loading purchased companies up with debt and then leaving them to die needs to burn in a fire.
The strategy certainly works in the short term (and nets impressive "profits" for the owners/shareholders of such holdings), but in the long term... let's just hope no one will ever be able to pull through this kind of "deal" again.
The ones who organize these deals have already taken the money and are long gone. The ones holding the bag after it collapses are the employees, suppliers and institutional investors.
Of course - what happened, happened. But when banks recognize that it is not in their interest to give loans to holdings to purchase companies in order to get loans on them simply because eventually when the loans on the companies default the banks are on the hook again, they will not loan them money any more.
That's the inherent beauty of interconnected and sold loans - no one will be left spared when they eventually default.
The 'Retail jobs growth by state' chart in this article (approx 2/3 down the page) is lovely: one square line chart for each US state, positioned roughly according to geography, all equal in size.
I find it very easy to grok compared to choropleth maps and similar charts that attempt to stay true to geography.
Unlike other non-map presentations of US state data, this layout preserves ability to spot regional similarities visually.
I find the hexagon version slightly more visually pleasing since it breaks up the straight lines—see the link for comparison. But either way, both are a huge improvement over the surface-based shapes when conveying data that is totally unrelated to the geographical surface of states.
The repeated charts all the same size makes it a "small multiple" [1]. Laying them out in a meaningful spatial way is a brilliant idea. I don't know if there's a name for that.
I felt like this chart shows that retail store closures are a lagging indicator for employment. Stores are up in NY, WA, TX -- all states where people migrate to to work in tech companies. (Not sure about ND and UT, though.)
Utah has experienced a tech boom as well. They have multiple unicorns. Qualtrics, Domo, pluralsight, as well as a large presence from Adobe, Microsoft, and eBay among others.
Are we seeing different charts? Mine is sorted by the percent change (over 2007 to 2017), not geography. Has Rhode Island at the top left, Alaska on middle-right, etc.
It's using a responsive layout. It shows them sorted like that if your browser's width is below a certain size, and the map-style arrangement if it's wider.
The graph is wonderful and makes me tune out most of the rest of the article, because the picture in the graph is the same picture you see everywhere: certain areas are booming (the south, Texas, the coastal parts of the west coast), others are slowly declining.
Full disclosure: I am the co-founder and lead developer at https://www.locally.com. We do exactly what I describe below and we're seeing great results. People want to buy from their local stores. They just need the modern paths to purchase: BOPIS (buy online pick up in store), local delivery, and the knowledge oh what is in stock nearby.
IMHO, the real path forward for retail is to get their in-stock goods in front of online shoppers via their brands' web sites, their own web site and local marketplace sites. Ecommerce is not the solution because nobody can expect to compete with Amazon.
Brands are learning the hard way that they cannot go D2C (direct to consumer), nor make a profit off selling on Amazon. They HAVE to support their network of retailers: small and large.
Yes, the day of reckoning for retail is coming. But it won't be an apocalypse. 90+% of retail transactions still occur in a brick and mortar store and people love to shop. Most retailers (and brands) just don't have the data and tools (yet) to drive traffic to stores. They're still figuring out the Amazon problem.
Why? I love my local baker, but for brand name items, I'm going to order online.
> BOPIS (buy online pick up in store)
Why is this attractive to anyone? If I am making the effort to fight traffic and parking to visit a physical location, I want to handle the item. "BOPIS" seems like the worst of all worlds to me.
> knowledge of what is in stock nearby
This is crucial. This is the main reason I no longer visit physical stores. They likely don't have the item I want in stock. It's just an exercise in pure frustration. I don't want to be cross-sold or up-sold, and I certainly don't need someone to order an item that will require a return visit in 2-4 weeks.
> local delivery
Maybe if it is same day, otherwise why do people care?
> Why? I love my local baker, but for brand name items, I'm going to order online.
really? even for things like bikes, sporting goods, clothes, running shoes, ... I could go on. And the thing is: you'd still be ordering online, just not from amazon. if you order directly from brands and the brand can inform you that there is a local shop that has it within miles, why not get it there? why waste the resources of having to have it shipped (long distance) only to potentially have to ship it back?
> BOPIS
same day delivery beats BOPIS but it is a solid option when there is limited stock. you are putting on hold. best buy and home depot are killing with this right now.
> > Why? I love my local baker, but for brand name items, I'm going to order online.
> really? even for things like bikes, sporting goods, clothes, running shoes, ... I could go on.
I have personally ordered all of these online, although there are some types of clothes that I don't like ordering online.
> And the thing is: you'd still be ordering online, just not from amazon. if you order directly from brands and the brand can inform you that there is a local shop that has it within miles, why not get it there?
Because I have to schedule a trip to the location. To me, this is like asking: "why not travel to the post office to pick up your mail?" Well, because instead the item can be delivered to my door step.
> why waste the resources of having to have it shipped (long distance) only to potentially have to ship it back?
In both cases, the item is traveling the same distance from manufacturer to my door step. It is more efficient to ship the item from the warehouse directly to my door step vs. first shipping it to some random location miles from my door step. The only difference is whose resources are used to ship the item the last few miles: my vehicle or a UPS truck. I guarantee the UPS truck is dozens of times more efficient.
With Amazon Prime (90 million US subscribers) shipping and most returns are free, so I'm paying twice if I use my vehicle to pick something up from a store. The current Amazon return process (explicitly to take this argument off the table): box arrives at door step, open box, try out item, take out preprinted return sticker, put return sticker on box, put box on door step, let Amazon know to pick it up. It is no effort. This is rare enough that the efficiency impact is minimal, although possibly less rare for clothes. The situation may change if returns become full fare.
> BOPIS ... is a solid option when there is limited stock
This is a super rare situation for me, but I agree that BOPIS is superior in this situation.
> best buy and home depot are killing with this right now
I'm quite surprised by this, is there a good article about this around?
Isn't this similar to the last-ditch effort Blockbuster tried while in its death throes?
I remember them taking on Netflix with the idea that it sucked to wait for another movie in the mail, so just come into the store and pick up a new one!
Not surprisingly, it turned out people hate going to stores more than they hate waiting.
I live near Lenox Mall and Phipps Plaza in Atlanta, and they could not be any busier. It's packed at 2pm on a Tuesday when I'm going to an eye doctor appointment. On the weekends there are often traffic issues in from people entering and leaving.
I feel like it's not that malls or retailers are dying, but instead all the revenue is going to a few places with wealthy, urban locations. Perhaps this has to do with the influx of people moving from the suburbs into cities?
#1: Buckhead is an affluent residential neighborhood, that turned into a startup hub and investment banker district in a couple of decades... but hasn't changed the "residential neighborhood" infrastructure. There are 24/7 traffic issues even when Lenox is closed.
#2: The Atlanta metro had about two-dozen thriving malls a couple of decades ago. Today there's, what? Lenox/Phipps, Perimeter, maybe Cumberland (?). Mall of Georgia way out in the boondocks, having killed all the others along the I-85 corridor? Even Lenox isn't as hopping today as it was in the "old Buckhead" (i.e. pre-Ray Lewis) days. The trend is pretty stark.
Throughout the 1990's, Buckhead had a TREMENDOUS club/nightlife scene.
In 2000, Ray Lewis was in town for an away game or whatever reason. He and his entourage got into a nightclub altercation that lead to a stabbing death... you know, just read his Wikipedia entry if you're not already aware of those details.
Anyway, it was an EXTREMELY high-profile story in the local press, and shortly thereafter the bar and nightclub scene was drastically curtailed.
Now, it's definitely arguable whether this should be attributed to Ray Lewis. The truth is more complex... political pressure from wealthy local residents had been building for years, and the Lewis incident was really just a "symbolic" tipping point. Regardless, a lot us lifelong Atlanta residents tend to remember that incident as one of those miniature 9/11-ish moments where a culture shifts abruptly.
Oh wow thanks, this whole time I thought that incident occurred in South Beach. Makes sense. I'm sad I'll never get to experience the "old Atlanta". I usually hear people describe it as pre and post Freaknik though.
I think that’s part of it, there is also the issue the article goes into about leveraged buyouts leaving several retail stores with interest payments that are just too high on otherwise healthy buisinesses. It isn’t enough for them to be packed, they have to show growth to beat the interest.
in general, it is difficult for me to separate a reasonable concern borne of the knowledge that a thriving economy is important from a sense that, so far, the big retail chains that are closing many locations sell junk that i both do not want and think is largely superfluous anyway.
Anyone got a reasonable way to synthesize those competing thoughts?
I think the America that will result from this die-off is a better place. Less suburban sprawl. Less giant eyesore big-box stores that no one enjoys spending time in. More informed purchases because people buy stuff online where it's easier to compare reviews.
But I think there will be significant, very painful collateral damage to people during this transition and I've very sympathetic to people hit by the job losses. Retail is one of the few remaining sectors in small towns. Most other work is becoming increasingly concentrated in big cities or automated away. The days of the US as a patchwork of thriving small towns is ending, but many people still live in those towns. Worse, the ones still there are often there because they are the least able to move — poverty, family commitments, etc.
The US is rapidly turning into a country that has no place for the unskilled, but is also failing to provide the education needed to deal with the millions of unskilled citizens.
I'm also confident that in all of this, it's not the finance industry that's going to be hurt. They'll pull another "too big to fail" maneuver and we taxpayers will bail them out, yet again transferring money to the ultra-rich.
>> More informed purchases because people buy stuff online where it's easier to compare reviews.
I was wondering about this forcing stores to provide more expertise and more flexible inventory. In my town 2 stores in a specific industry went out of business 3 years ago and made a big deal in the papers about how too many people were buying direct from manufacturers instead of visiting their store. I had been to both stores, asked some questions about products, got dumb answers and bad attitude, so I went home and bought everything online. In the last 2 years, 3 new stores in that same industry, 2 of them MASSIVE, have opened up near by (one of them in the same strip mall), and are doing very well. The difference? When you walk into these stores the employees know what they're talking about and they VERY quickly adjust inventory based on current market trends. Now I make most purchases in one of these 3 stores and not online - because I can do research better by talking to them and I can get most things immediately. It's required bigger investment from the owners, but they have thrived where previous stores failed and blamed e-commerce.
Doesn't work with a lot of commodities, but if you're in retail, I think it's clear you need to specialize and add value - and that requires more investment. Don't just be there and expect to keep existing.
The risk with this approach is that you become a showroom for Amazon.
I knew a guy who ran a shoe store and provided a high level of personalized service when selecting the right shoe for your feet, gait, use, etc. Hiring and training employees who were knowledgeable enough to do that, plus having to spend a lot more time with each customer, made it a lot more expensive to sell shoes, and when Amazon and other online retailers started offering shoes for a lot lower prices (because they didn't have to provide the same level of personalized service), he eventually went out of business because people would come into his store and have him help them find the right shoe, then go home and order it for 20% cheaper or whatever.
If you are a consumer, it seems rational to go somewhere and try something on, get expert advice about it, etc, then go purchase it wherever it is least expensive. Why pay 20 or 30% more or whatever for the same thing? Some sort of unwritten social contract (this is usually the reason I don't use local stores as showrooms)? Time sensitivity? As a retailer who goes this route, you kind of have to pin your hopes on those things.
Showrooming is a real problem, and retailers are faced with the decision of trying to add value and hope people end up buying there even though it costs more money, or trying to cut costs in every possible way to compete on price, and I don't know that it's an easy choice all of the time.
> I think the America that will result from this die-off is a better place. Less suburban sprawl.
Why would this lead to less suburban sprawl? Unleashed from any interest in physical commerce, wouldn't suburban sprawl perhaps be even more attractive? There's a lot of assumptions here that these changes will have us reverting to older forms, but I don't see any reason why.
> Less giant eyesore big-box stores that no one enjoys spending time in.
Instead, we'll have giant eyesore big-box empty buildings on oversized empty parking lots littering the land that nobody wants, and few who can afford to tear down and replace.
And what will they replace them with? New houses or apartments or condos few can afford? Maybe office space?
There would be a lot more jobs if we readjusted the way we look at work. Lower full time to 30 hours a week, eliminate "free overtime" salaries, require vacation time, maternal/paternal leave, worker owned co-ops keeping their jobs from getting shipped away, start building publicly funded mental health/ drug rehab clinics everywhere. There are a lot of ways to create more jobs. The fact that the jobs don't exist now doesn't mean we can't make them, we just need to shift our priorities.
I think the synthesis is the hope that the market replacements for these stores is less terrible. The big displacer in the last few years has really been Amazon, who I think offers a better shopping experience than most overpriced specialty stores. Many of these stores only held firm in the market due to having an information advantage over the consumers, as well as the convenience of providing items that are similar in kind (ie toys at toys r us). The effects of a post online shopping and price comparison world are still being shaked out.
>>> junk that i both do not want and think is largely superfluous anyway.
I'm reminded of an article I read last year about parents buying presents for kids at Christmas. In the 90s it was easy. The kid wanted a thing. A gaming device, a dress, or a car... there was an object that the kid wanted to own. That object was sold at a store. But today's kids don't want things. They have the iPhone. What they want is 50,000 likes on facebook. Their happiness is tied less directly to things than social acceptance. Often having the thing leads to that social acceptance, but increasingly not. Your seeing the junk as superfluous, and mentioning it here on HN, fits with that shift away from retail goods and towards social acceptance via online communities.
I think they still want things, just happen to be more "experience" related, which are more expensive. International travel, expensive restaurants, "off the beaten" path type adventures, performances etc are all in vogue, and all are good for displaying status on Snapchat and Facebook. A $50 toy isn't good for that, and the younger kids probably find more enjoyment in using phones or with video games.
Would it help if you considered that if over 6000 stores closed, it is very likely the majority are small stored and not big chains? From what I saw in Bloomberg article it was 550/6000 are chain stores. That leaves significantly more to small shops that are trying to provide employment and selling worthwhile goods to their local communities.
For example here in buffalo we have small stores for spiritual goods that also serve as community centers for such spiritual practices.
> stores ... that also serve as community centers ...
Historically, public markets have also provided a platform for important non-commercial informal civic interactions. The review section of e.g. Amazon doesn't seem to cut it.
Yes and no. When my family immigrated to US when I was a teenager, I was struck by the role played by the local 7/11 (!) and strip mall as the hang out place for the suburban kids. There was literaly no where else in the suburbs. So yes, not exactly an "agora" but better than nothing.
It is general market dynamics that at times stores will have things that don't sell. Whether or not "you" find them useful or not is a different story, sometimes a store will be doing well selling things you might find useless, simply because you are not the target market.
The confluence of events that the article alludes to are that many retail stores went through a period of consolidation and buyout through leveraged debt. As anyone with big credit card bills understands, it sucks when you're spending a huge chunk of your income just to pay interest on your credit cards. (or in these stores cases their junk bonds).
This massive debt load is forcing changes faster than what one might see organically and as a result there is a lot of turmoil in the retail business.
Plus, the strategists that put these retail chains in this debt are no longer there actively working on strategy within this mess. There is more profit for them, personally, working on other deals. Net result, the "rock-stars" set up a mess, pull huge gains from the table, then leave the 2nd or 3rd team to navigate a very difficult debt load they left behind.
Optimistically, it means that workers will be freed up to do things that are more important. Cynically, all you (a generic programmer type) really need is food, lodging, a laptop, an internet connection, so anyone not producing or repairing those things are superfluous to you, which is actually the majority of humanity (even if you include infrastructure and supply chain). "Humanity" itself becomes a wasteful, carbon-emitting luxury you allow yourself for sentimental reasons.
Or you can be sentimental for practical reasons:
"Eliminating the middleman is never as simple as it sounds. ‘Bout 50% of the human race is middlemen, and they don’t take kindly to being eliminated."
> so anyone not producing or repairing those things are superfluous to you
But we don't program in a void, right? Somebody has to create work for us and those would be the ones doing "superfluous" things. In other words, nobody would need our programming if all they did was supporting our programming.
Progress, at least under capitalism, enables(or pushes) more and more people to do stuff that is less and less necessary, because junk is growth and growth is what's capitalism aimed at.
I'd say that "thriving" needs to be redefined. We think of "thriving" as being, say, 2007. It wasn't. That was an overheated, unsustainable bubble. "Thriving" means there's jobs, and growth, but it's not providing all the junk that everyone ever wants. Maybe "healthy" is a better word.
This is going to be brutal over the coming decade. "The most recent government statistics show that salespeople and cashiers in the industry total 8 million." Contrast that with 70k coal workers. Imagine the devastation in the coal belt spreading to suburbs all over mid America.
For some additional context, that's about 5% of the total US labor force (160 million). The current labor force turnover (hirings and firings/quits) is around 5 million per month.
Fair point, but the comparison is a bit uneven - you are comparing one industry's post-devastation numbers with another's pre-devastation numbers. Across the rust belt, just a few decades ago, there were many times more coal workers than 70k. If you go back to 1923 there were 883k.
Articles like this are starting to ring little bells for me. There's an argument that the government's reaction to the 1999 financial crisis (and the 1998 Russian bond crisis, which figures in) is what inflated the housing bubble [1], which started to show cracks in 2006 and 2007 (with the Bear Stearns fund collapses) and then went full-bore once things started unwinding in 2008 as home prices started to fall, and the hugely leveraged positions started to unwind.
Since the Fed stopped the liquidation of bad assets and refused to allow pricing to adjust, the question is what new bubble we funneled capital into. There's a lot of evidence that banks have been reluctant to make loans to consumers, both because of real risks around modeling of real estate pricing, and also because of changes in the regulatory regime.
It seems like it's possible that we're starting to see where all the credit has been going -- rampant investment into retail. The article mostly ignores restaurants and grocery stores (explicitly so) but we've seen other articles [2] talking about those sectors starting to show weakness as well.
Krugman and keynesians think that all (aggregate) demand is equal. Austrian school adherants understand that bubbles are fuelled by central planning and malinvestment.
I agree. These investment firms pickup companies for a song when their stock prices fall and then basically gut them of any value they possess. They force the companies to take on massive liabilities that make them unsustainable. Then they slap on a fresh coat of paint and sell them off to any sucker whose willing to buy them. They leave these companies circling the drain.
Retail is the prime example of middleman business. The middleman businesses don't produce anything by themselves and attempt to extract profits via information asymmetry and/or some value adds such as geographically closer availability. Eventually both of these should be done by machines. Throughout the history technology has been killing off middleman businesses such as travel agents, insurance agents, stock brokers and so on. Retail is not an exception and I would expect most middleman businesses to be extinct eventually.
I know all you alpha-nerds just never want to leave the house and could live in a 20foot square cube and sit on the toilet with your laptop while only consuming auto-delivered soylent and a caffeine IV drip for all you care, but let me help you all out with a little in understanding this retail thing:
Retail is mostly about entertainment now, primarily for women. Women like to shop for clothes and try stuff on. They like to be taken out to restaurants and movies and go to these with their friends. They like to go see their personal trainer at the gym. They like to go and get their hair and nails done and gossip. They send their kids to the math tutor. They send their littler kid to gymboree. They have a coffee at Starbucks.
If you look at some of the retail REITs and listen to their conference calls, a lot of stores are going out, but a lot are going in. Things are definitely changing to be more service and health oriented and the Big Box and Mega Mall trend is certainly over. The smaller format residential and mixed use stuff is going to be fine because they are more about services and entertainment as opposed to merely transactional delivery of mass market goods. People still want to leave the house and go somewhere.
> Retail is mostly about entertainment now, primarily for women. Women like to shop for clothes and try stuff on. They like to be taken out to restaurants and movies and go to these with their friends. They like to go see their personal trainer at the gym. They like to go and get their hair and nails done and gossip. They send their kids to the math tutor. They send their littler kid to gymboree. They have a coffee at Starbucks.
This paragraph is so ridiculous. All of it is just little patronizing insults about women for normal things men and women like to do. As a male, I also like shopping for clothes, going to restaurants and movies with my friends (women are 'taken'), going to the gym (women go 'for their personal trainer', because we all know they can't do it alone), and getting my hair cut and nails worked on (women also need to gossip). I've even heard tell of men sending their kids to tutors and gymborees and having coffee at Starbucks. Crazy, right?
It's interesting that you start by insulting the parent with this generalization about their 'alpha-nerd' status, and then drop straight into a parody of men's and women's stereotypes from the 1950s, and then finish with a pablum point about people still wanting to leave the house.
Fewer people can afford those experiences. There's usually one or two nice parts of town with (search for Apple store, Nordstroms, or Whole Foods), where you can find new development.
But buying stuff made in China was cheap, even people who made $30k/year could do that. But going out for coffee, brunch, movies, massages, trainers, that stuff is way more expensive, and so is limited to the nicer parts of town.
On the low-end there's Dollar Tree (DLTR) and Ross(ROST). Mid-market Costco(COST) has also been doing well. Prices at Ross are much much lower than Amazon if your time is cheap or you like shopping. Similarly, grocery delivery is expensive if your time is cheap.
Setting aside your rudeness and the sexist tone of your second paragraph, can you share any sources that support your opinion of the current trend in retail?
It is true that women have higher social integration than men. IKEA, which is a glorified warehouse for the home, adds social value with a cafeteria, a deli and childcare. You do not see that at Home Depot.
But if you read the article it describes a lot of businesses which are profitable and could plod along, except they're saddled with tons of debt from leveraged buyouts.
In other words, they're saying the businesses aren't profitable enough to service debt loads that were thought to be sustainable debt loads a few years ago.
That still points to lower than expected retail profit. Interest rates have been unusually low for more than a decade, so it's not like a credit spike changed the assumptions.
>thought to be sustainable debt loads a few years ago.
No, the debt was never sustainable. Essentially the banks allowed loans which were gigantic ponzi schemes.
Retail: "Our growth will continue forever!"
Banks: Hmm, we got bit pretty hard on these home loans and need somewhere else to make money, "Forever growth is like infinite money, I like money!", "Here is 10 billion dollars, just remember to pay us back in 2017".
Google used to provide rare value: large scale of organization of information. They also philanthropically raised standards f the web: way better mail service, map service.
They raised the standards, but you're delusional if you think they did it philanthropically. They did it because they thought they could get more info to sell ads.
Aggregation, filtering, sorting, recommendations could be best handled by machines. All businesses specializing in this using human efforts are at grave risk.
I disagree. Amazon is an utter failure when I don’t know the exact product I want to buy: reviews are faked and many of the products are of low quality, with no way to test them except for a terribly inconvenient return process. I’d rather just try on clothes in a store and not buy ones that I don’t like instead of having to sigh and package them up and wait for a refund.
You may see retail employees as unnecessary middlemen, but they provide a value a machine cannot.
I can talk to GameStop employees about which new games they played to see if they’ll be fun; I can talk to petsmart employees about proper pet care; I can go over installation prodcedures with the Geek Squad folks at BestBuy; I can get recommendations on outfits at the upscale men’s clothing store I frequent...and so on.
There is no superior specialization in this regard. Many of these examples are because of the relationships I have cultivated with long-term retail employees, who know me and my preferences far better than any machine learning algorithm has attempted to match.
> Aggregation, filtering, sorting, recommendations could be best handled by machines.
That only changes who those middlemen are and their scope. Based on what I'm currently seeing on search machines can only deliver exactly what I'm asking for. Rarely do they recommendations that aren't patterns. For example, I was looking for backup software a few months ago, I get tons of ad pages on backup software now. I purchased that software months ago and no longer need backup software. It's probably going to be many more months before my search history cycles out of ad networks.
Another example. A road was recently converted to pedestrian only in my neighborhood. Would you like to know the number of Lyft/Uber drivers that follow Google Maps end up at a dead end and have to double back? And that is coming from the world's most powerful search engine.
Potentially but when you're at a store you can immediately tell the if the store has a good or bad purchasing department. It does provide tangible positive value.
You're silly if you think that the industry isn't already using large data analysis to do this job. There's still plenty of value by having a human at the end of the tunnel to actually interpret it though.
Yeah but presumably as the end user you'd still want to interface with a single entity, even if behind the scenes they're then aggregating, filtering, etc. But yeah any humans employed by them doing that work are probably at risk.
Fair point but this function grants them immoral control of both ends of the market.
Often they lie to producers to lower prices then lie to consumers by selling these deal at the usual rate (or faking a false discount week for appearances and then put back products back on the normal shelves).
As other said, economic and information asymmetry is not good.
Honestly .. aggregators should be a national thing, there's almost no competition to be had there. Kinda like internet, it should be way more neutral, except maybe on safety check (again, something to nationalize).
There's already a national aggregator... Amazon. Anything more 'nationalized' would smell of socialism and nobody's ready for that.. Though I wouldn't mind socialized medicine/education personally.
200 unique items is just a basic house. You are forgetting all the essential products used to operate said house as well as all the family members inside, plus pets. 200 is average.
After I posted I had the same thought. But then I realized that durable goods from a store usually come in packaging, so measuring outgoing material isn’t as inaccurate as it sounds as first.
Most of us are really pretty bad at tracking our purchases. We don’t want to look at them because it means admitting we have a problem. But we know the trash is full all the time and don’t think about how that correlated with consumption. Basically I was trying to trick people into an honest conversation about something nobody likes to be honest about.
And at any rate if the quantity is “more than 200” then it just reinforces GGP’s point.
Retail, where it still works, is about curation. I've been working recently with a specialised retailer and his stocking of a particular product is effectively a seal of quality.
The few shops I go to, I don't go there because they have every possible product, I go there because I know their purchasing reflects the opinions and qualities that I also value.
I'd imagine this is also partly due to the America's demographic changes and the aging population. The large baby boomer generation is retiring and entering a period in their lives where their consumption is lower. Generation X is smaller and can't keep up the consumption. Generation Y is slowly entering a consumption phase.
The author misses one key point: it’s not only about debt coming due on their scheduled dates. It’s that much of this debt is also saddled with covenants that can cause a debt to be collectible at any time if the terms are not met. Things like a company's loan-to-value ratio, leveraged inventory through high accounts payable, and other financial metrics. In short, market troubles can force long-term lines of credit to abruptly come due.
There's lots of talk here about the changing shopping habits of Americans, but I think we're glossing over the debt issues. These companies seem to be burdened with too much debt, which is reflective of how big business manages itself. I think this has more to do with poor management then changing shopping habits. People's habits change all the time and it seems management was asleep at the wheel.
Make sure you read the article and don't just come here to comment: there's an important point that this isn't (just) due to Amazon and overbuilding, but because a lot of these troubled chains-- even the ones that are still profitable!-- are loaded up on debt from leveraged private equity buyouts. Once again, PE accomplishes nothing except stripping healthy companies to sell their organs.
Am curious how the profitability part is calculated. Seems like annuity payments or interest/payback on the loan is ignored? If these chains were profitable after counting in debt, there would be no debt - right?
I think the GP is saying that absent the LB types extracting the money in the past, these companies would be profitable even after including interest payments because they had no business need to take on that debt. It was incurred solely as a mechanism to turn the company into a debt-machine for the benefit of the then shareholders. They took a bunch of expected future earnings, as a lump sum, at that time that turned out to not be real.
I posit that shopping by visiting multiple stores and maybe finding what you need is a less optimal experience than choosing what you want on a screen and having it delivered. You waste less time, vehicle and fuel expenses, and you get what you want. There might be a few niches where touching or trying it on make for a better shopping experience, but for the most part, I think people would be opting for online purchasing which would put many stores in trouble even without the debt.
Hmm, I hadn't thought of it that way. I had figured that having it delivered was less efficient. But once you factor in me having to drive to the store just for my purchase, whereas the delivery truck is going to make N deliveries, I think you're right that delivery is actually more efficient.
Very nice graphs to illustrate and support the points.
First I like how there is no piechart, but box charts (easier to read). Then the 2nd path of job recovery in time since 2008 show a more recent divergence of retail job.
Finally, it is the first time I see how GIS maps can be supplemented by stacked rectangular graphs for each state where the trend in time is shown. I spotted something going on in New England on the choropleth, but the graph nailed it.
Very inspiring to read, especially for the graphs.
I'm not saying this article is wrong. I do find it interesting that it is posted just before most retailers post their quarterly earnings reports, while the sector is already severely battered with huge short volume.
In theory yes however you're assuming that there's no collateral impact from a store closing and that there are alternatives.
Large retail chains are often anchor stores that sustain retail centers. When they shut down the economy of the retail center collapses. This impact spreads beyond the retail centers to surrounding businesses. The reduced retail traffic means that fewer people are stopping for lunch at restaurants, fueling up at gas stations, picking up prescriptions at Pharmacies, dropping off dry cleaning, etc. As a result these businesses are forced to cut back on staffing and possibly reduce hours. This causes further declines in business as the quality of service decreases. Eventually many of these business are forced to go under.
The abandoned retail centers also impact property values in surrounding areas and result in increased crime rates.
This process isn't immediate and the works displaced do not immediately find new employment. Thus you have a period where these workers are either without jobs or facing ever reducing hours which results in less disposable income.
In large urban centers you might have a dozen or more retail centers to chose from within a short distance from your home but in rural ares you're lucky if you have more than one.
In a lot of rural America you'll find many communities surrounding a Walmart often on the outskirts of a dried up husk of a town. In the 80s and 90s Walmart built supercenters just outside of the jurisdiction of small towns. The retailers in these towns couldn't compete on price and eventually folded. The small shops that didn't directly compete with Walmart (e.g. nail salons, shoe repair) eventually would end up leasing space inside the Walmart.
The failure of a major company that's over leveraged does not mean each location also closes.
What's being described is a company who's operations are profitable, that simply has excessive debt. In that case the operations can be sold in bankruptcy to recover whatever money is possible with the buyer assuming operations.
What kills malls is when an Anchor store is unprofitable.
Not to mention the network effects. If half the stores in a mall close with no new ones opening, that whole mall is going to go under, and it's going to damage all the stores in the process.
plus everyone who serviced those stores has just lost a market. All that HR software you sale, all the consultants, all the property owners, all the insurance people, the janitorial and other support staff...
to take your statement a step further than just retail, I'll say that the entire economy is effectively largely dependent on people spending money. Which is why trickle-down economics has been not working at all for at least a few decades and yet somehow this is still the resoning for tax plans.
the idea being that the 1% who has 90% of the country's wealth needs a little more to create jobs (from thin air)
whereas the truth is that people spending money is what will create jobs
"Trickle down" has never made any sense to me. Maybe it's different at big companies, but at small ones 100% of the hiring I've observed goes something like this: "uh oh, we have[1] more business coming in than we can handle, better hire!". Never, ever "welp, we have extra cash, better hire for... uh, some reason". Extra money without an actual need to hire more workers might go into marketing or sales, but only to a (lowish) point.
[1] Usually "we have", but sometimes "we anticipate".
Do you still shop in brick and mortar stores? Other than food (groceries and restaurants) and sometimes clothing, I haven't shopped in a brick and mortar store in so long that I can't even remember when was the last time. It's just so easy to buy things online, even small one off purchases. The other day I needed some AAA batteries so I just hopped on Amazon and ordered them and they showed up a day later. I probably could have used Prime Now to get them within hours if I really needed them right then. That is so much simpler than traveling to a store and back to pick up anything. I'm really not sure how most brick and mortar stores will stay in business.
Yes, but I live less than two blocks away from two stores that factor into my lifestyle: ACE Hardware (i own a house and can do a lot of the maintenance on my own), and a local pet supplies store (1 dog, 1 cat).
Yes, i definitely pay a premium for purchases I make at each one of these. But it’s not an astronomical amount, and it makes more sense if you think about these kind of stores as local warehouses.
Why don’t I just have a 70lb bag of dog food delivered every n days? Idk, I don’t want to have to think about the dog food until I have to think about the dog food. If dog food shows up when I’m out of town, or there’s actually a weeks worth of food left because Externalities, now I have an extra dog food storage problem.
Recently I was tempted to buy a fancy tool but when I picked one up at a store I realized the handle didn't fit my hand at all. Talking over alternatives with an experienced seller was helpful. Retail has an important future even though it will be smaller and more focused.
Most of the time smaller items like AAA are more expensive online than say Lowe’s, Walmart, or Costco. For me I will always choose the cheaper option which has been brick and mortor.
I will never order groceries. Picking my meat and fresh produce is something I will never outsource. Especially if it is more expensive.
I order online because it is usually cheaper for electronic accessories and books.
I still make a ton of brick and mortar purchases. I’m one block away from a drugstore, where I get things like batteries, bathroom needs, and lighters. Three blocks away from both Trader Joe's, equally close to the weekly farmer's market.
But I also live in an actual city instead of an endless sea of suburban houses.
I have never been a big shopper, but I find I do a 50/50 split. I also tend to buy gifts at physical stores so I can get ideas and know I have them in my hand. I also like stores when details matter like furniture or luggage.
If anything I am doing less online shopping over time as I keep getting burned. Though I also lived next door to a mall for years which changed my habits somewhat.
competing anecdata: if i just needed some batteries, i wouldn't use amazon for that. i already get too many boxes from them, which accumulate as unwanted guests in every corner of my house, so i try to consolidate small orders. and there is some additional friction there: making sure all my orders have been delivered, not allowing boxes to hang out on the porch too long in case they might get stolen, etc.
far more likely, i'll just put the batteries on my shopping list for the next time i am at the grocery.
As awesome as the 1-click button is for getting products to your door, box fatigue is a real thing. Lately I just add products to my cart until one of those additions become pressing, then I review my cart and purchase. Half the items in there I wind up relegating to the "Save for Later" list.
Honestly, it also provides the thrill of impulse shopping without the guilt or monetary expense. Most of the "save for later" items never get ordered, or I realize they're part of a bigger project I need to make time for.
Do you still see this as the likelihood if as predicted by many futurists that 40% of jobs are displaced completely by 2030, and no sort of safety net like guaranteed basic income instituted?
I personally think we're headed for a crash that's more than just a depression but something on a whole different level. Dependent of course on automation / job losses / politics between now and 2030.
The common thread I'm sensing is that private equity and leveraged buyouts are pouring fuel on the retail fire, after reading about the Toys R Us deal it astonished me how they got raked over the coals by a PE firm.
Retail jobs are already a dead end and this news doesn't make things any brighter. The structure of having space that many people go to during the day with ample parking seems sound enough...
Is there some kind of job that actually needs to be done that wouldn't better be filled by automation? If not, maybe light automation (local 3D printing and final assembly) could move to such spaces.
Even with high consumer confidence, retail is dying. The middle class no longer has the same spending habits as it did for the past 60 years. Its fair to say that retail malls and outlets as we know them might not exist in the next 15-20 years. Why would somebody walk into a Macys and buy and item when you can order it of Amazon and have it delivered the same day for %20 cheaper?
There are still some things you might want to buy in person. Fresh produce, for example, or clothing. Especially clothing. A lot of people like to try on clothes before they buy - they want to see how it looks on them, they want to check out the quality and weight of the fabric. Plus, if you're picky about color there's no substitute for looking at something in person.
I realize you can effectively do that online by buying a bunch of stuff and returning what you don't want. But that's more of a hassle than just going to a brick and mortar retailer.
Sure, if they buy the same brand. But styles change. Not everyone is like me, still wearing the same brand (though sadly, not the same size) of jeans I wore in high school.
I don't know about you, but I don't only ever buy one brand/style of pants.
Hell, even if I wanted to, often by the time I need more pants, things have changed. Either the brand/style combo is no longer available, or I've gotten fatter (or skinnier! It has been happening recently!).
The middle class is shrinking and can't maintain the same spending habits. Home prices/equity are a sustaining source of activity anymore because so many lost their homes in the last recession.
A breakdown of retail by their target income demographic might reveal more.
Big box chains and suburban shopping malls were doomed to fail. They built in a boom time and built in places expecting to draw in new development and residents from tens of miles away. But they based all their site decisions on an impractical urban development model (suburbs) that turns out to not work in reality, and they lost their drawing power to online retail. Smaller form-factor retailers are doing fine because they can easily go where the demand is and provide better service without making customers feel like cattle. The big box chains are realizing this and contracting to smaller stores more conveniently located to try to keep up with the market. They still have a price advantage and people are willing to walk or drive short distances to have goods now rather than wait a couple days for their Amazon Prime package. I hope the massive amount of equity tied up in the failing subsection can be transferred elsewhere though...
One strong headwind to this trend is fraud. Seller fraud is well-known, and payment systems have bent over backward to insure this, but buyer fraud is even more popular these days. It's easy to cheat a seller:
I'd like to see more intimate online shopping experiences involving at least a short (30s) video call between buyer and seller, at least for first-time customers. It would be particularly potent to make pleasant greetings, express joy at the opportunity to shop/serve, show the credit card on the video monitor, a photo-id, plus incidentals that give a sense for who you are. That way fraud only happens with full-blown identity theft, and now you have a good image of the thief to help the victim get relief, and you can even add the thief to a buyer blacklist. (Interestingly the video evidence format helps avoid the case where a seller blacklists people they "just don't like".)
The free market in action. Retail outlets are simply not equipped to handle the tastes of the modern consumer. It is an industry that saw huge growth in the 80's and 90's and has not been able to keep up with technology. As the segment of the population that still exclusively shops brick-and-mortar ages, unless these businesses can evolve and modernize they will continue to fail. Tough break, but its ultimately better for the consumer. Retail jobs are some of the worst ones to have too, so as long as the gross job counts are replaced then good riddance.
There are real problems that brick-and-mortar solve though, mainly having instant tactile demos of products, like holding an iPhone at the Apple store or trying on clothes. Future businesses will figure out how to combine the two approaches into a profitable business model. Trunk club is a good, if expensive, example.
> Retail jobs are some of the worst ones to have too
True, but they are also some of the only jobs nowadays that are available to people without college degrees, or people who have effectively aged out of the white collar or blue collar workforce, but still need to generate some sort of income. Notice how many retail clerks nowadays are in the 55+ set.
I know, thats why I qualified it with "so as long as the gross job counts are replaced" Being a millenial, most people I've met in my age group are working in either retail or food service. Many of them also have 4-year degrees, just not in a business or technical field. One could say they should have made better educational decisions, but I would rather live in a world where we can celebrate the variety of human interests and endeavors, and not subject people to a lifetime of economic purgatory just because they didn't learn programming or whatever in school. I'm lucky because I happened to be legitimately interested in something that is very profitable in today's economy. Others are not so much, and I really feel for them. But the solution does not lie in dead-end jobs that give no kind of gainful employment.
Some context - I live in Buffalo, one of the areas in the 10-25% range.
You can't give away commercial space here in Buffalo. Prices are <$1/sq in a lot of places. A few years ago, ~60% of the commercial space in North Buffalo was vacant.
Our malls are...problematic. Two have already converted into office space, with a third being slowly transitioned as it empties (I believe it is empty now). One of our malls is dying a slow and painful death, even as it is surrounded by a booming retail space. Our other mall has been designed very well to be a destination vs an in/out type of location.
But there are still many commercial vacancies. I don't know a lot about zoning, but many of these locations should really be repurposed to residential. There's also a large sprawl problem.
Finally, it looks like Niagara Falls was included in that statistic and Niagara Falls is an absolute shithole.
Now all of a sudden, I want to go to America just to see how terrible and horrible the shopping malls are.
I'm from Australia which is full of them (though we call them "shopping centres"). And they seem very pleasant to me. They are convenient for many kinds of shopping. I didn't hang out there as a teenager in the '90s, but others from my school did.
Since then they have become more pleasant for socialising -- though perhaps more upmarket and less teenager friendly. They have proper restaurants as well as the old food courts. And my mother's favourite cafe is at a shopping mall -- and it is reallyp excellent.
In general the malls aren't horrible. Since you are from AUS, the first thing you'd notice, is there are twice as many stores/sq ft of space per capita.
The big problem with this is AUS GDP is about $47k per person. US GDP is 57k. So for only $10,000 more earned per person, we have double the retail space. This can't possibly work long term. US retail is in bad shape because of terrible monetary policy.
For years the Roosevelt Field mall outside of New York City had a rather crummy food court. The food was mostly junk fast food, the tables were scarce and tightly packed together.
In more recent times, they redid the food court. It is bigger, with a lot more room to sit comfortably and relax a while. They have some more upscale dining choices, organic food, vegetarian food. It makes it more likely that I would stop and eat there.
I would think the competition from online made them do this. They are in a good location and didn't have to worry much about bringing in customers before.
It may be anecdotal, but the local retail malls have put up their holiday decorations earlier than ever before. Every pole wrapped and bows everywhere. Feels like they're trying to fight the good fight.
Retail stores don't sell what I want. Their inventory has become too limited.
After the dot com bust/mini recession, most department stores stopped stocking clothes in my size so I buy much of it online. I frequently try to hold out and find some electronic item or replacement part in local stores. I almost always fail and resort to Amazon.
I'm currently looking for a cheap Bissel vacuum that is available on Amazon. I have yet to see a retailer anywhere carrying that model. Expensive, overpriced vacuums are all you can get retail these days.
It’s funny that I work next to a mall and don’t mind shopping in it. Actually I would prefer it.
Problem is, I’m a gorilla... not skinny enough to be “tall” and not fat enough to be “big”, and there is not one store out of 250 that sell size 14 shoes, or a shirt with a size 19 neck that doesn’t look like a parachute, or a 52 long jacket.
I see it in other areas. If you walk through Lord and Taylor or Macy’s, there’s a whole floor of petite women’s clothing. I look on the mall and see lots of bigger, taller or bustier women, all of whom are wearing clothes — but not from Macy’s!
When you focus on the average consumer exclusively, you miss a lot of people!
Have you tried going to an independent vacuum cleaner sales/repair place and asking them to order it for you, and pay them the markup for the time and effort? Sure, it wouldn't be cheaper than Amazon, but if you want to support local business, it is an option (if you have such a place in your area).
Im curious as to what the response will be from regulators when these loans start to mature. I'm assuming none of these companies are 'too big to fail', and will be allowed to fall apart. That's the big difference between 2008 and now I think. Will anyone want the assets of Macy's, Kohl's, etc. once commercial retail collapses? It's going to be a real disaster I think, and unfortunately the hardest hit will be the poorest Americans once again. Big winner? Amazon...
>In the U.S., retailers announced more than 3,000 store openings in the first three quarters of this year.
That sounds like an insignificant number -- you can get as many openings, if not way more, in a country with 10-50 million population (but less centralized retail sector, with fewer cross-country chains).
I've worked at Kohls and JC Penney, and anyone with half a brain who has worked in an entrenched retail chain has seen this writing on the wall for many years. Clothing from these stores are generally out of touch with modern trends. They can't keep up.
Did it show how rural areas compared to urban areas? I only looked at the visual map quickly and it looks like rural areas are going to hurt the most. If so this will have great political consequence.
Is all about making the experience better to compete with online shopping. Retail can check out how movie theatres differentiate themselves from the living room.
I wish the city had an online inventory. Often I want to buy something specific and I am willing to go to the city for that. However, I don't know which of the hundreds of stores carry that item and which ones are available. Sometimes I give my best guess a call, but it's a stretch. I wish there was an interface so I could search what they're offering.
(For example: Who sells empty glass bottles, a braided belt, fridge magnets, facepaint? There are probably about 10 stores that have it, but which ones? I can easily walk one or two kilometers just checking them out. FYI, this is a European town.)
not really. All that is happening is that online retail is subsuming offline retail, while total retail sales keep growing. The bull market has further to go . long Amazon
Please remind me, if I'm ever a loan officer at a bank, to not issue a huge loan to a traditional retailer that was just taken over in a leveraged buyout -- jeez!
imo this comes down to centralization and the popularity of "big box" stores. People generally don't want to go to a specialty store anymore, the toy section at Walmart is fine.
These things go in cycles. When I was a kid if you wanted a toy you went to the toy section of a department store. The department stores spent decades contracting as specialty stores boomed. And now the specialty stores are shrinking in favor of the big box stores.
It's likely the specialty stores are being crushed by online retailers. Their raison d'être was always having more inventory depth than general retail, e.g. the shoe store has a much better selection than the shoe department at Sears. But if you're after selection, you can't do better than your browser.
Interesting thought. I actually hate big stores because I have to walk a huge distance to find the right section, it’s harder to find the thing I want, they’re more crowded, they’re more likely to be understaffed (30 checkout lines with 2 cashiers is very common)... It’s typically a much bigger waste of time than going to a small store.
But I’m definitely a purposeful shopper: I’m always in and out with one goal in mind, I never “browse”. Maybe wal-mart and the like are more attractive to people who just kinda want to browse around and kill time?
For me it's just the fact that if I'm grocery shopping at Target, I can go look at the menswear department for a few minutes because I also like buying new clothes. It's much much harder to buy good fitting and good looking clothes online because you don't get true colors and fit without trying it on. This is a main reason that many box stores target women more than men, since statistically women are more interested in clothing than men.
Did they ever want to? I would bet many people prefer the toy to be delivered at home rather than going to Walmart also. Only difference is now we have that option.
My daughter prefers to pick her toys out in person. For everything else, Walmart Pickup is fine (order the day before, order is brought to the car when you arrive).
However, I do feel bad for the people that will lose their jobs over it.
Let's make towns have downtowns, with beautiful brick roads, scenic ponds with some ducks, perhaps a waterfall, some nice cafes, a lawn with benches, some parks, some nature, trees, live music, a library and museums. It's okay to have some retails stores sprinkled around here and there, as long as they're original, and not those mass market plastic selling behemoaths we see everywhere.