Retail stores in the US have gone through a rough patch over the past year with many of them closing. Historically there is normal rate of store closures but a key difference during the past year is the rate at which major jewelry retail chains have been closing branches and going through bankruptcy and re-organization.

The major chains normally are on the trend of opening new stores every year.

It is easy to blame the current economic downturn for the increased rate of store closures - especially the majors. However, it is important to keep other factors in mind as viable and even more important causes of reduced traffic and sales to brick & mortar stores (stores with physical locations).

The key reason a large percentage of retail jewelry stores are suffering and even failing is the fundamental changes in the shopping and search habits of consumers, brought about by the Internet and mobile technologies.

Other important factors causing store closures are over-leveraging finances, bad customer service and plain lack of sales skills. Even online pure-play retailers are not immune from these factors and many face new issues such as online reputation management.

The current economic downturn is only accelerating the process. Stores with the foresight to see the “real” reasons will have a much higher chance of surviving if they take correct actions. Certainly a store that has been in business for 98 years has been through tougher economic times in the past and survived.

Following is a sample list of some of the most visible closures in the USA.

Zale shutters 118 stores
Summer 2009 - Zale Corp. closed 118 underperforming stores during the fiscal fourth-quarter.

Finlay files for bankruptcy
August 2009 - Finlay Jewelry Inc. filed for Chapter 11 bankruptcy protection becoming the latest retail jeweler to fall prey to the economic crisis.

Tanishq jewelers has closed both of its U.S. locations
August 2009 - Tanishq, the Indian jewelry chain that had aggressive expansion plans for its unique store design concept, has closed both of its U.S. locations.

Michigan jeweler closes after 98 years in business
July 2009 – Michigan-based Godfrey Jewelers recently closed its doors after 98 years in business after three-generations.

After sales plummet, David Webb files Chapter 11
June 2009, New York--David Webb Inc., a 61-year-old family-owned retail and manufacturing jewelry operation with stores in Manhattan and Beverly Hills, Calif., is the latest industry player to file for Chapter 11 bankruptcy protection.

Robbins Brothers seeking bankruptcy protection:
April 2009, Los Angeles, CA. Robbins Brother which operates over 25 retail locations filed for bankruptcy protection. Company expects to keep all stores open and resume normal operation.

Source of closures: National Jeweler Network

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