Staples, Inc announced today that the company is planning to shutter approximately 70 locations in the United States before the end of the year. The revelation comes after the companies sales fell 4% from last year.
Staples will also have to develop a strategic plan after their proposal to merge with competitor Office Depot was halted by an injunction from the FTC over antitrust concerns. The FTC argued that a merger between the two biggest office supply stores would be anti-competitive and result in higher prices of pens, printer toner, and fax-machine paper. Like most retailers, Amazon has become a huge thorn in Staples’ side, posing a huge competitive threat as Amazon plans to develop business contracts for office supplies as well.
The store closings do not come to as much of a surprise when you realize that more than half of Staple’s sales are online, making them the fourth-largest online retailer in the U.S. behind Apple, Wal-mart, and Amazon.
Office Depot on the other hand closed 65 of its stores during its fourth quarters, and now intends to close an additional 75 locations in 2017. The company also says in its annual report that was released Wednesday that they expect sales to be lower in 2017 than they were in 2016.
While neither of these stores should be considered down for the count just yet, the closing of a combined 175 stores in one year in the same market implies that both could to be edging towards the chopping block, especially since their merger was taken off the table. The appliance market is already experiencing similar fear with the likes of Sears and hhgregg becoming nearly extinct.