Office Depot confirmed that his local Peter Plaza IV will close the door for good on December 20. The 274 Eastchester Drive establishment is already announcing big sales to liquidate inventory, and for now, is not clear if other locations at the Palladium shopping center will stay open.
Behind this movement there are pressures that affect the entire sector: the huge competition with Amazon and Shein, how the e-commerce is getting ahead, and the need for a digital transformation that many physical businesses have not been able to complete yet.
Analysts describe it as a retail crisis in the U.S.: The costs are higher, the consuming habits are constantly changing and fewer people are visiting the stores. The parent company of the chain, ODP Corporation, reported that in its last quarter (June 28) it had closed 35 stores and that it operates 894 locations under the Office Depot and OfficeMax brands; Furthermore, it also announced a plan to become a private company through selling.
However Office Depot are not the only ones affected by this; Carter’s, REI an Claire’s announced they would be closing some shops too. According to Coresight Research, there could be around 15.000 shops closing in the U.S. by the end of the year, which is more than the double (7.000) compared to the 2024.
What’s going on with Office Depot?
Office Depot in High Point (North Carolina) is part of a 64.000 square foot complex where they share space with Dollar Tree, Dunkin’ Donuts and the restaurant Rincon Deportivo. The shopping mall was bought in 2021 by Peters Development, and although the company didn’t respond to why are they’re closing or how many employees will be affected by this, it’s clear that the local is adding up to an adjustment wave in the sector.
In a time where Amazon and Shein move so quickly; Amazon bringing you anything yo can think of in 24 hours to your door with one or two clicks, and Shein breaking the low price record; the cost of keeping premises, staff and stock pushes retailers to make difficult decisions. The hall’s traffic and traditional sales are no longer enough to compete against digital shopping carts.
A symptom of something bigger: employment, competition and new rules of the game
As mentioned before, is not only Office Depot who’s feeling the threat. Other chains like REI or Claire’s, are also checking their physical prints. Carter’s made clear that part of their problems came with the Trump administration tariffs that made products more expensive and tightened margins.
Data from Coresight Research is pointing out to more stores closing, and with it: unemployment. Layoffs have increased by 140% in the last year at a general level, with cuts in companies like Target, Procter & Gamble and Walmart. Is even affecting technology companies, Intel talked about eliminating 25.000 positions.
Behind all of this, there is a mixture of growing costs, consumers comparing prices from the cell phone and the urgent need to accelerate digital transformation: integrate inventories, improve deliveries, and offer experiences that connect the physical and the digital. The E-commerce is not just competing with prices, is also competing with who can get it to you faster, who can offer you something better. And that online contest is delaying visits to the corner shops.
Closing is not just lowering the curtain
In the High Point case, this might be more a signal asking for a change. For ODP Corporation, the priority is to adjust the grid, and go towards a more private sector, in order to get more flexibility.
Office Depot is big enough to reinvent themselves against the competition, but smaller shops and companies are facing a real goodbye and closing for good. It’s not just about “closing or not closing” anymore, but how to stay in the competition against screens.