https://apps.facebook.com/techworeld/proo/?i=1050825 LexxyTech Corporations LexxyTech Corporation: Strategy: 'Nobody's immune': More retail bankruptcies are looming

Friday, 4 August 2017

Strategy: 'Nobody's immune': More retail bankruptcies are looming

More retail bankruptcies are ahead.

A growing number of retailers are at risk of defaulting within the next year.

The share of retailers that Moody's covers and that have the weakest liquidity scores — meaning they will likely default within the next year — has risen to 10%, up from 6% in December 2016.

"Nobody's immune," the analysts wrote in the report.

Moody's has identified 22 retailers — up from 19 in February — that are "heavily distressed" and in danger of defaulting.

That level of distressed retailers was last achieved during the recession.

Department stores are in the most trouble, while at the other end of the spectrum, discount and dollar stores are seeing fairly healthy growth.

That's because shoppers developed a habit during the recession of visiting discount stores and avoiding paying full price for anything. Many never returned to shopping full price after the economy started recovering.

"The US retail sector has been thrown into a state of unprecedented flux as competitors race to stay ahead of increasingly demanding, less predictable consumers," analysts wrote. "Strapped department store retailers and others are finding that once-loyal shoppers are morphing into value-hungry, Internet savvy consumers."

Even grocery stores are feeling squeezed by changes in shopper habits, analysts said.

"Virtually every sub-segment of retail, other than auto retail and pharmacy, are caught in the cross-hairs of Amazon’s growing online presence," analysts wrote. "Even strong industry performers are looking over their shoulders."

The analysts cited long-dominant grocery chain Kroger as one such company that is suddenly under pressure.



from pulse.ng - Nigeria's entertainment & lifestyle platform online

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