Survival, at least in the retail space, requires change. What worked just a few years ago may be a recipe for failure now.
It's easy to blame online sales for that, but the reality is that debt, not Amazon, has been the key driver in forcing companies into bankruptcy. Major players like Bed Bath & Beyond, Pier 1 Importers, and Toys R Us may have lost business to the online giant, but it was an inability to pay vendors because of their heavy debt loads that forced them out of business.
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Brick-and-mortar retailers have, in many cases, thrived, especially at chains like Walmart (WMT) and Target (TGT) , which have embraced an omnichannel model. Digital sales are, of course, important, but they have not ravaged in-store sales the way many people think.
"Total e-commerce sales for 2023 were estimated at $1,118.7 billion, an increase of 7.6 percent (±1.2%) from 2022. Total retail sales in 2023 increased 2.1 percent (±0.4%) from 2022. E-commerce sales in 2023 accounted for 15.4 percent of total sales. E-commerce sales in 2022 accounted for 14.7 percent of total sales," according to U.S. government statistics.
Digital sales matter, but 15.4% means that the vast majority of retail sales still take place in brick-and-mortar stores.
Image source: Guitar Center
100-year-old chain makes a tough decision
You would think that most people would want to handle a musical instrument before buying it. Despite that, one of the giants in the space, Guitar Center, filed for Chapter 11 bankruptcy in 2020.
It survived that process and continues to operate. Now, one of its chief rivals, Sam Ash has decided to take steps to ensure its own financial health.
An iconic chain, which first opened in 1924, Sam Ash has built its business around brick-and-mortar stores,
"Our motto is Come in And Play. Yes, we'd love you to buy but more importantly, we want you to have an experience. Music and musicianship is thrilling and exciting, and were just happy to a special part of that journey," the chain shared on its website. "Visit any Sam Ash Music Store at any time and you're guaranteed to see somebody making music. Playing the incredible selection of instruments is not only allowed, it's encouraged."
That's a strong way to encourage musicians and drive instrument sales, but Sam Ash has decided to close many of its stores including its flagship location in Manhattan as well as one of its oldest stores on Long Island.
Sam Ash closing 18 stores
Before its decision to close many of its stores, Sam Ash operated 44 locations in Arizona, California, Connecticut, Florida, Georgia, Illinois, Indiana, North Carolina, New Jersey, Nevada, New York, Ohio, Pennsylvania, Tennessee, Texas, and Virginia.
The company did not make the decision to close stores lightly.
“For the last 100 years, Sam Ash Music has successfully adapted to meet the challenge of changing business conditions. As we look towards the next 100 years, the company must continue to adapt to ensure its continued success,” Sam Ash told amNewYork Metro.
The company, which also sells through its website, wanted to make it clear that it's not abandoning brick-and-mortar stores.
“Sam Ash Music remains committed to keeping a strong physical store footprint in the future while we continue growing our successful online sales offerings. As part of this restructuring, the company is closing several stores nationwide. This restructuring is emotionally tough, but we are confident these moves will make Sam Ash Music stronger as we continue serving the music community into the future, as we have for the past 100 years,” the chain shared.
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Liquidation sales have begun at the impacted stores but the company has not shared specific closure dates.
