A national commercial real estate investment firm, Madison Marquette, has assessed the stability of the largest U.S. retail chains, and ranked these retailers based on their risk for bankruptcy in the short-term. A overview of the list is below, arranged according to the bankruptcy risk that Madison Marquette has assigned to the companies.
U.S. Retail Companies Assess to be High Risk for Bankruptcy:
The story is generally the same for the retail companies that have been designated as “high risk” by Madison Marquette. Sales declines + high debt + low cash reserves + looming debt payments = high risk. Chico’s, Cost Plus and Dillards are keeping bankruptcy at bay with cost-cutting, inventory reduction, and operational efficiencies. Talbots took more drastic measures by selling off its J Jill brand stores, which were floundering and draining the company’s resources. These are the retailers that may be the next to join the retail Chapter 11 tally in 2009:
- Chico’s
- Cost Plus World Market
- Dillards
- Talbots
The duration of the retail recession, and the strategies that company leaders employ to respond to it will determine if these major U.S. retail chains can keep themselves off the high-risk list above or move themselves onto the low-risk list at the bottom. These are the retailers that are still struggling to find firm footing in the industry-wide retail recession:
- Abercrombie & Fitch
- Aldo Shoes
- American Eagle
- Ann Taylor
- Barnes & Noble
- Belk
- Blockbuster Video
- Borders Group
- Brookstone
- Cache
- Christopher & Banks
- Coldwater Creek
- Crate & Barrel
- Express
- Foot Locker
- Fossil
- Gamestop
- Gap
- Home Depot
- J Crew
- Limited Brands
- Lowes
- Modell’s Sports
- Office Depot
- Office Max
- Pacific Sunwear
- Pottery Barn
- Rite Aid
- Saks
- Sears
- Signet Jewelry
- Starbucks
- Super Valu
- The Limited
- Tween Brands
- Whole Foods
- Williams Sonoma
- Zales
These retail companies are either thriving in the recession economy or riding it out the economic with relative comfort. Even though same store sales for many of these companies in 2009 have been considerably lower than they were in 2008, their cash reserves, credit lines and expense management are sufficient for the downturn.
Many of these low-risk retailers have been defying the recession by increasing sales and opening new store locations. Innovative offerings, value pricing, and quick responses to dramatically changing buying habits have helped these successful companies to capture the attention of discerning customers, and strengthen loyalties despite price-motivated fickleness.
The low-risk retail chains below are expected to retain a significant position in the post-recession retail landscape, and some of these retail brands will emerge stronger, bigger, and more powerful than they were before the global retail economy plummeted in 2008.
- Aeropostale
- Apple
- Bebe
- Bed Bath & Beyond
- Best Buy
- Buckle
- Burlington Coat Factory
- California Pizza Kitchen
- Coach
- CVS
- Dick’s Sporting Goods
- Dress Barn
- H&M
- Harris Teeter
- Hibbett Sporting Goods
- Hot Topic
- JC Penney
- JoAnn Stores
- Jos A Banks
- Kohl’s
- Kroger
- Macy’s
- Michael’s
- Nordstrom
- Panera Bread
- Payless ShoeSource
- Petco
- PetsMart
- Ross Stores
- Royal Ahold
- Safeway
- Staples
- Steve Madden Shoes
- Target
- The Children’s Place
- TJ Maxx
- Urban Outfitters
- Walgreen
- Wal-Mart
More About the Financial Health of U.S. Retailers:
