UBS U.S. Retail: How Many Retail Stores Need to Close in the U.S.?
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Between the fourth quarter of 2023 and the third quarter of 2025, the United States witnessed the closure of over 10,000 retail stores, excluding food service, gas stations, and miscellaneous retail. UBS estimates that if e-commerce penetration rises from approximately 22% currently to 27% by 2030, alongside a 4% compound annual growth rate in retail sales, the market will need to shutter roughly 40,000 additional stores.
Under this base case scenario, total store counts would decline from 947,078 in 2025 to 906,825 by 2030. The impact varies significantly across subsectors. Apparel and accessories are projected to lose 14,090 stores, while consumer electronics could shed 11,690. Conversely, home furnishings and auto parts face minimal disruptions.
Industry concentration continues to accelerate, with Walmart, Costco, and Amazon driving 35% to 55% of total U.S. retail growth over the past nine quarters. Stores remain critical to the retail ecosystem, handling up to 97% of e-commerce fulfillment for certain major retailers.
However, ongoing structural pressures could intensify closures. If tariffs persist through 2030 and create an annual 0.5% drag on retail sales, store closures would exceed the baseline projection by 21,000. Furthermore, declining consumer time spent on merchandise purchasing and dropping store density metrics suggest a prolonged period of sector optimization. Average EBIT profit margins for hardline, broadline, and grocery retail are expected to stabilize near 9.0% in 2026.