A deluge of reports detailing the closure of major retail chains in 2020 has inundated consumers across the board. Scores of instantly recognizable brands have either shuttered operations completely, are divesting poorly performing business units, or are in the midst of brutal bankruptcy and liquidation proceedings.
The likes of major US SMEs such as Century 21, Bloomingdale's, Hallmark, Nordstrom, CVS, Kmart, Bose, Sears, Sur La Table, Olympia Sports, Offers Depo, Macy's, Forever 21, Papyrus, Family Video, J.C. Penney, Victoria's Secret, Bed Bath & Beyond, Game Stop, New York & Company, Stage Stores, Pier 1 imports, and Modell's Sporting Goods are but a handful of the notable brands that have suffered enormously in 2020.
According to a report by Katharina Buchholz on Statista [These Brands Are Closing The Most US Stores In 2019], the top 10 worst impacted US retail outlets (in ascending order) vis-a-vis the retail apocalypse include the following:
Victoria's Secret - 53 stores closed in 2019
Sears - 70 stores closed in 2019
Performance Bicycle - 102 stores closed in 2019
Gap - 230 stores closed in 2019
Chico's - 250 stores closed in 2019
ShopKo - 251 stores closed in 2019
Family Dollar - 390 stores closed in 2019
Charlotte Russe - 520 stores closing 2019
Gymboree, Crazy 8 - 805 stores closed in 2019
Payless Shoe Source - 2500 stores closed in 2019
To add insult to injury, 40% of these top 10 worst performing US companies were listed as going out of business. They include Performance Bicycle, Charlotte Russe, Gymboree, Crazy 8, and Payless Shoe Source. With 2020 rapidly approaching its end, an even larger contingent of businesses is staring bankruptcy in the face. As cases in point, Modell's Sporting Goods, Dressbarn, Pier 1 Imports, others have come into sharp focus.
Modell's Sporting Goods: Brought Back from The Dead by Tai Lopez
In 2020, this iconic sporting goods retailer announced that it would be closing an estimated 153 outlets. The decision comes hot on the heels of poor revenues, declining footfall at retail outlets, due in part to the novel coronavirus and the retail apocalypse. Modell's Sporting Goods also had to contend with heavy competition from e-commerce giant, Amazon, and multiple successive poor seasons (weather and performance) for local sports teams which hampered the sale of high-end items like jackets, leggings, and sports shoes.
For Modell's Sporting Goods store, the writing was on the wall. The company was losing money hand over fist, and ultimately had to file for bankruptcy. This decision, difficult and painful that it was, ushered in fresh hope courtesy of REV (Retail E-Commerce Ventures) under the stewardship of CEO Tai Lopez and former NASA scientist, and co-founder of Zoosk dating app, Alex Mehr. Back in March, Bloomberg News reported that the beloved Modell's Sporting Goods store had filed for bankruptcy.
This news was met with elation from Lopez and Mehr, given the huge popularity of the Modell's Sporting Goods brand. They swooped in and presented a buyout offer to the tune of $3.64 million. This buyout gave REV the sole rights over its trademarks, domain name, and brand assets. However, the turnaround strategy employed by Lopez is not simply to pump money into failing land-based stores; it's to transform the way the business sells its products to its consumers. To this end, Lopez and Mehr envisioned an online platform for all sales-related activity, customer support, and communications. The switch to e-commerce operations sealed the deal - in a good way - for Modell's.
The entrepreneurs intrinsically understand market dynamics. The shift away from land-based retail activity to e-commerce accelerated in 2020 owing to the pandemic. People would much rather shop online at an e-commerce giant like Amazon, eBay, Alibaba, or others than frequent traditional stores. When Lopez took the instantly recognizable brand name online, it had in immediate impact on the bottom line. The strategy is likely to continue moving forward, given the huge cost-cutting benefits, and profit-driving potential.
The Story of Pier 1 Imports - A Huge Success for REV
Pier 1 Imports is one of the most recognizable home furnishings, décor, and accoutrement brands in the business. However, in 2020, as many as 936 stores were slated to be closed, owing to the retail apocalypse, the novel coronavirus, and the company's inability to appeal to buyers. Of course, it doesn't help that e-commerce giants like Amazon, eBay, and Wayfair are soaking up much of the business. The company opened its doors to the public back in 1962, and became a veritable icon in the industry. Unfortunately, the death-knell sounded in 2020 - at least for retail operations.
Pier 1 Imports was snapped up by Tai Lopez of REV in 2020 for a tidy sum of $31 million. Once again, the company relinquished control of its brand name, inventory, and merchandise to Tai Lopez' company. When the dust had settled, all commercial activities of Pier 1 Imports were taken over by REV and the company started its inexorable turnaround strategy. The resurrection of Pier 1 is regarded as one of the great comeback stories for iconic brands in the US. Heading this initiative is the investor-entrepreneur, and talented social influencer, Tai Lopez.
DressBarn Forced to Dress Down Before Tai Lopez Swoops in to Save the Day
Decades ago, in 1962 DressBarn was born. This iconic fashion brand provides a smorgasbord of accoutrements, clothing styles, designs, and workwear for women. It began trading on the stock exchange in 1982 and remained hugely successful for many years. Unfortunately, this retailer fell victim to the retail apocalypse, and the compounding pressures of the competitive business environment. As such, they announced bankruptcy proceedings in 2019. Once again, it was the strategic vision of Tai Lopez and Alex Mehr who came to save the day.
These investor-entrepreneurs wasted no time making an offer to purchase, and gaining control over the iconic brand's intellectual property rights and retail assets. Once the deal was signed, Retail E-Commerce Ventures swiftly took DressBarn online initiating a dramatic turnaround strategy. At its zenith, DressBarn featured an impressive 650 land-based locations in 2019. When Tai Lopez and Alex Mehr stepped in, they eyed the company's annual sales of $740 million as reason enough to warrant an aggressive takeover bid.