Retail Apocalypse Accelerates: 200 Winn-Dixie Stores To Close As Parent Goes Bankrupt

After shutting down more than 5,000 stores in 2017, store-closings are accelerating in 2018 with news that Bi-Lo LLC, the supermarket company that owns the Winn-Dixie chain, is preparing for a potential bankruptcy filing as soon as next month, and is planning to shut almost 200 stores as part of the move - either before or after the filing.

Winn-Dixie joins JCPenney (JCP), Bon-Ton (BONT), Toys R Us, Sam’s Club (WMT), Macy’s (M), Sears (SHLD), Kmart (SHLD​), and others in the growing list of 2018 shutterings as the 'great economy' that stocks foreshadow fails to show up in the retailer landscape.

As Clark.com details, the new year is shaping up to be another difficult one for traditional retailers.

J.C. Penney – 8 stores 

After closing more than 140 stores in 2017, J.C. Penney is shutting down one of its distribution centers and eight more stores nationwide, The Dallas Morning News reports. Around 670 jobs will be cut with the closing of the distribution center in Wauwatosa, Wisconsin, this summer. Meanwhile, around 480 employees will be affected by the eight stores that are closing, which follows a post-holiday review. The locations will be shut down between now and May, according to CNBC.

Bon-Ton – 42 stores

The Bon-Ton Stores Inc., a department store chain, is closing more than 40 underperforming locations this year, including stores under all of the company’s nameplates. Store closing sales are scheduled to begin on February 1 and run for approximately 10 to 12 weeks, the company said in a news release. Associates at the affected locations will be offered the opportunity to interview for available positions at other stores.

Toys R Us – Up to 182 stores

Toys R Us, the iconic Wayne, New Jersey-based toy retailer, has announced that it will shut down up to 182 U.S. stores. Store closing sales are likely to begin in early February, with the bulk of the closures expected to take place by mid-April, according to a letter from the company’s CEO. However, some closures may be avoided if the store can negotiate more favorable lease terms.

Sam’s Club – 63 stores

Bad news for Sam’s Club members! The Walmart-owned warehouse club has abruptly shut down multiple locations across the country, according to local media reports. The retailer has confirmed that 63 clubs are closing and up to 12 of them will be converted to e-commerce fulfillment centers. Walmart said the impacted clubs will close over the next few weeks, leaving 597 Sam’s Club locations.

Macy’s – 11 stores

Nearly a dozen Macy’s department stores will soon be closing their doors forever. In a news release, the company announced the closure of 11 Macy’s stores. It’s part of the retailer’s plan to close approximately 100 stores, which was announced back in August 2016.Macy’s intends to close an additional 19 stores as leases or operating covenants expire or sale transactions are completed.

Sears and Kmart – 103 stores

Just days after the holiday shopping season ended, Sears Holdings announced that it’s closing more than 100 stores.In a news release, the struggling retailer said it told associates at 64 Kmart and 39 Sears stores that the locations will be shut down between early March and early April 2018. Liquidation sales will begin as early as January 12 at the impacted department stores. Sears Holdings previously announced plans to shut down 63 Kmart and Sears stores this January. The company closed more than 350 locations last year.

J. Crew – 50 stores

After reporting a 12% sales drop for its third quarter, J. Crew said it will close dozens of stores by the end of January 2018, CNN Money reported. In a news release, J.Crew said it expects to close 50 stores during fiscal 2017, which ends in January.

 

 

And now Winn-Dixie plans to shutter 200 of its 500 stores...

Winn-Dixie's parent, Bi-Lo LLC, which went bankrupt in previous incarnations in 2005 and 2009, may still find a way to restructure its debt out of court.

However, as Bloomberg reports, with low margins and ample competition, the grocery business has always been challenging. But now the industry is contending with a more aggressive push by big-box retailers like WalMart (WMT) and Amazon.com Inc. (AMZN), which acquired Whole Foods last year to give it a larger brick-and-mortar presence. The moves threaten to force older chains to either consolidate or revamp their operations.

Bi-Lo is laboring under more than $1 billion in debt following its 2005 buyout by Lone Star Funds.

The company and its creditors have held talks to discuss a possible debt-to-equity swap, as well as alternatives such as asset sales, Bloomberg reported last year.

Lone Star piped in $150 million when the grocer exited Chapter 11 the first time, and invested $275 million to help fund the purchase of Winn-Dixie in 2012. But it probably will still come out ahead, having paid itself at least $800 million since 2012, along with management fees it’s collected, according to regulatory filings.

Southeastern Grocers, based in Jacksonville, Florida, says it’s the fifth-largest supermarket chain, with more than 700 stores and 50,000 employees. It also operates the Harveys and Fresco y Mas chains.

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Brittany Lacey 6 years ago Member's comment

I read #Topps super markets were going bankrupt as well.

Gary Anderson 6 years ago Contributor's comment

I don't think it is Amazon. It is Walmart and Kroger seem to be dominating. Whole Foods doesn't seem to know if it want to compete on price or if it wants to be a high quality store. It is trying to be both on the backs of its workers. Working for Amazon is almost like being on the plantation what with workers crying and the like.

Alexa Graham 6 years ago Member's comment

I think it depends on whether you are talking about physical stores or online. Sure #Walmart has been taking an increasingly larger bite from grocery sales while it is still too early to tell if the #Amazon acquisition of Whole Foods will have a meaningful impact on it's marketshare.

But when it comes to online shopping, Amazon is becoming increasingly distruptive. It wasn't long ago that I started doing about 25% of my shopping online direct from the supermarkets' websites (usually as a result of a coupon being sent my way). But lately, I'd say about 75% of my grocery shopping comes straight from Amazon. Either direct or through Amazon Fresh. Prices are pretty good (especially when paired with their frequent coupons, shipping times are super fast, quality is excellent, and the customer service can't be beat.

Gary Anderson 6 years ago Contributor's comment

You can order from Walmart and Kroger and spend a lot less than Whole Foods. Besides, I don't want tears in my order. Amazon is ruthless toward its employees, IMO.

Ayelet Wolf 6 years ago Member's comment

I think the younger generations are doing more and more shopping online... that's where Amazon reigns supreme.