Nordstrom Inc (NYSE: JWN) announced this week that it would not be reopening 16 of its closed stores as the company struggles with its finances amid the Coronavirus pandemic. Nordstrom is just one of many retailers struggling with pandemic related closures, with some of its contemporaries facing bankruptcy.
Like most retailers, Nordstrom was forced to close its doors across the United States amid the Coronavirus pandemic as it was not considered an essential business. Of the company's 116 stores, 16 will not re-open as the company tries to reduce overhead amid economic volatility. "More than ever, we need to work with flexibility and speed," said CEO Erik Nordstrom.
The closures, a means to adjust the company's presence "based on the needs of each market", is just part of a larger restructuring of the company to try and weather the ongoing pandemic. Amid the restructuring, the company is stated to be adjusting its support roles and corporate organization, with a target of $150 million in savings.
The restructuring, however, is not entirely due to the pandemic, according to Erik Nordstrom. "We've been investing in our digital and physical capabilities to keep pace with rapidly changing customer expectations. The impact of COVID-19 is only accelerating the importance of these capabilities in serving customers," Nordstrom said.
Nordstrom is just one on a growing list of victims as the ongoing pandemic wreaks havoc across the world. Neiman Marcus made headlines when it filed for Chapter 11 bankruptcy earlier in the week. JC Penny (NYSE: JCP) skipped another interest payment and may be considering bankruptcy; the company has been experiencing problems since before the pandemic. JC Penny's stock price has been in free-fall since the beginning of the year, shedding 86% of its price since January, a symptom of the company's larger financial crisis that has only been exacerbated by the pandemic. Macy's (NYSE: M) is delaying its quarterly report as a result of pandemic-related financial struggles.
Communities are now opening across the United States, albeit at a slow pace. Even with stores beginning to reopen, it is unlikely that many of the hard-hit retailers will be able to survive entirely unscathed. Many, such as JC Penny, were already in dire straits before the pandemic. With a return to total normalcy still some months away, no immediate relief for the retail industry appears to be in sight.