The calendar has barely flipped to January, but the retail industry is already tallying 2026's casualties. According to Coresight Research, 566 U.S. stores have announced closure plans for the new year—a number that will almost certainly grow as companies finalize their strategic reviews and respond to evolving consumer behavior.

The Headline Closures

Several major retailers are leading the charge with significant footprint reductions:

Macy's: The iconic department store chain will shutter approximately 150 locations by the end of 2026 as part of its "Bold New Chapter" strategy. The closures focus on underperforming stores while the company reinvests in its stronger locations and luxury Bloomingdale's brand.

Kroger: America's largest supermarket chain is closing roughly 60 underperforming stores over the next 18 months. The grocery giant is reallocating resources toward locations with stronger demographics and e-commerce fulfillment capabilities.

Walgreens: The pharmacy chain continues its multi-year rationalization, with additional closures planned for 2026 as it navigates declining prescription margins and changing healthcare delivery models.

7-Eleven: The convenience store leader is trimming its portfolio, focusing on locations with higher foot traffic and favorable real estate costs.

Dollar General: Even the discount sector isn't immune, with select closures planned despite the chain's generally strong performance in serving value-conscious consumers.

The Survivors and Casualties of 2025

Last year provided a stark preview of retail's ongoing transformation. Coresight Research tracked 8,234 permanent store closures in 2025—the highest number ever recorded—though below the 15,000 they had initially predicted.

Notable casualties included:

  • Rite Aid: Announced closure of all remaining locations after filing bankruptcy twice in two years
  • Joann: The craft retailer declared its second bankruptcy and liquidated after failing to find a buyer
  • Party City: Closed hundreds of stores following a late-2024 bankruptcy filing

The number of retail bankruptcies did decline year-over-year—30 chains in 2025 versus 51 in 2024—suggesting the weakest players have already been culled.

What's Driving the Closures

"These store closures reflect a business cycle driven by slowing demand, economic malaise, and rising input costs," explained Kevin Thompson, CEO of 9i Capital Group. "The retail industry is undergoing structural changes as higher costs and weaker consumer spending pressure margins."

Several factors are converging:

  • Shifting consumer behavior: E-commerce continues to capture share from physical retail, particularly in categories like apparel and electronics
  • Labor costs: Minimum wage increases in multiple states are squeezing margins at labor-intensive retailers
  • Insurance and security costs: Retail theft and property insurance have become significant expense items, particularly for urban locations
  • Real estate optimization: Retailers are increasingly strategic about store footprints, preferring fewer but better-performing locations

The Paradox: Strong Demand Despite Closures

Here's the surprising twist: despite the closures, overall demand for retail space remains robust. The national retail vacancy rate sits at just 4.1%, one of the lowest levels in years.

How can this be? The answer lies in format evolution. As legacy department stores and drug stores contract, other categories are expanding:

  • Discount retailers: Chains like Dollar Tree, Ross, and TJ Maxx continue to grow
  • Quick-service restaurants: Fast-casual dining is absorbing former retail space
  • Medical and wellness: Urgent care centers, dental offices, and fitness studios are filling vacancies
  • Fulfillment and logistics: Some retail space is converting to last-mile delivery hubs

Consumer Sentiment: The Confidence Crisis

Underlying the retail transformation is a deeper consumer confidence problem. According to a December survey from The Century Foundation, 66% of Americans say the economy isn't doing well, and nearly half have dipped into savings to cover routine expenses over the past year.

This sentiment gap—between reasonable economic data and pessimistic consumer attitudes—is forcing retailers to adapt their value propositions. Discount and value-oriented concepts are thriving; premium and discretionary categories are struggling.

What It Means for Communities

Store closures ripple beyond lost shopping options. Each closed store means:

  • Local job losses, typically ranging from 15-100 positions depending on store size
  • Reduced property tax revenue for municipalities
  • Potential blight if spaces remain vacant
  • Longer travel times for consumers, particularly in rural areas

Communities that were already "retail deserts" may face even greater challenges as national chains retreat from marginal markets.

Investment Implications

For investors, the retail landscape requires careful navigation:

Avoid: Traditional department stores and mall-based retailers without clear digital strategies

Consider: Off-price and discount concepts with disciplined expansion; grocery chains with strong private-label programs; retail REITs focused on essential services and experiential tenants

Watch: How effectively major retailers like Macy's execute their turnaround strategies. The gap between well-managed decline and chaotic collapse can be the difference between value opportunity and value trap.

The Bottom Line

The 566 closures announced for 2026 are not the end of retail—they're part of retail's ongoing metamorphosis. The industry is shedding outdated formats while evolving toward a more efficient, digitally-integrated future.

For consumers, this means some inconvenience but also new options. For investors, it means separating companies managing change effectively from those simply managing decline. And for communities, it means adapting to a retail landscape that looks increasingly different from the one they grew up with.

Welcome to 2026—where the only constant in retail is change itself.