Although a relatively strong holiday season demonstrated that retail has resilience, perhaps more than pundits touting a retail apocalypse might have expected, significant bankruptcies are likely in the years ahead, according to Michael McGrail, chief operating officer for the Tiger Group.
Alone or with partners, Tiger Group said it recently conducted liquidation sales for Gander Mountain, Gordmans, RadioShack, MC Sports, Vanity, Sears Canada and hhgregg.
At least 21 major retailers filed for bankruptcy protection last year, McGrail pointed out.
In 2018, he noted, department stores, mall-based specialty retailers and smaller furniture chains in the U.S. continue to face headwinds. Traditional retailers have to cope with the growth of pure play e-commerce retailers and a resurgent and more multifaceted Walmart.com as well as reconsider aggressive expansion plans that may already have them in an overstored position, McGrail indicated.
On the positive side of the ledger, he observed, many retailers have been adapting to the evolving marketplace by shedding underperforming stores, upgrading omnichannel capabilities, adding food operations, shrinking store formats and signing store-in-store deals.
Still, he stated, brick-and-mortar stores are in the midst of a shakeout that will lead to additional bankruptcies and liquidations that will have their own impact on the marketplace going forward.