To concentrate on the company’s more profitable brands, Ascena Retail Group is planning to shutter approximately 650 Dressbarn stores. The company also owns apparel chains Loft and Ann Taylor, CNBC reported.
The company stated that the decision to shutter the stores wasn’t easy to make. “Dressbarn chain has not been operating at an acceptable level of profitability in today’s retail environment,” said CFO Steven Taylor in a press release.
As the closures won’t immediately occur, shoppers will still be able to shop in the retailer’s stores and online. The company also noted that employees will be kept up-to-date on decisions about the timing of specific store closings and vendors, and suppliers will still be paid on “normal terms.”
While Dressbarn has been around for more than 50 years, the report noted the retailer has been challenged when it comes to growth: Consumers are looking toward off-price chains like Ross Stores and TJ Maxx, as well as fast-fashion merchants such as Zara and H&M, in addition to Target. At the same time, Amazon is still taking a large share of the online apparel market.
In other recent store closure news, a UBS report warned that 75,000 stores are likely to shut down by 2026. Analysts said the closures would affect a range of different merchants, including an estimated 21,000 apparel stores, 8,000 home furnishing stores and 10,000 consumer electronics stores. The reason for the closures, according to past reports, can be attributed to the fact that more consumers in the U.S. prefer to shop through eCommerce.
UBS reported the average U.S. household spent $5,200 online in 2018, a rise of nearly 50 percent from five years earlier. It also stated that eCommerce is expected to make up 25 percent of retail sales, and roughly 16 percent of overall sales.