Grim economic forecast for department store chains
NEW YORK - Department store chains are facing a grim economic forecast as the coronavirus crisis drags on.
“What we’re going to see is that a couple hundred thousand people are not going to have the chance to go back to the jobs they had,” said Greg David of Crain’s New York Business Magazine. “Many of [the stores] are really deeply in debt and it’s very hard to see how they’re going to pay off those debts.”
Online shopping had already created a seismic change in the retail landscape, forcing major retailers like Macy’s, Sears and JCPenny to close stores. While many department store chains are still operating online, experts say those sales simply won’t be enough.
“There’s an enormous number of retail enterprises that just won’t have the financial capacity to come out of this intact,” said Professor Mark Cohen of the Columbia Business School. “So we’re going to see an enormous amount of bankruptcy, store closings, an awful lot of merchandise being deeply discounted.”
Another issue is that, even when states reopen, some people might be afraid to go shopping in stores, while others simply won’t have the money to after losing their jobs.