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Plans For Nordstrom Rack Location Closings in 2022

Joel Eisenberg

The discount iteration of the department store stalwart has announced strategic business decisions for the current calendar year.

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Nordstrom’s RackShutterstock

Author’s Note

This article represents the latest in a series that attempts to elucidate the truth behind internet rumors of business location closures, and is based on corporate postings and accredited media reports. Linked information within this article is attributed to the following outlets: CNBC.com, Wikipedia.org, SFGate.com, Stores.NordstromRack.com, ScrapeHero.com, RetailDive.com, Press.Nordstrom.com, PRNewswire.com, ChainStoreage.com, and Google.com.

Introduction

Wikipedia features a comprehensive overview of the Nordstrom Rack chain, which states, in part: Nordstrom Rack is an American off-price department store chain founded in 1973, and a sister brand to the luxury department store chain Nordstrom. It competes with off-price department stores including Burlington, Macy's, Backstage, Ross Dress for Less, Saks Off 5th, and the TJX Companies.

Per the company’s website, there are presently 338 Nordstrom Rack locations in the U.S. As a comparison regarding the Nordstrom department store chain proper, ScrapeHero.com offers a location count: There are 345 Nordstrom locations in the United States as of May 25, 2022. The state with the most number of Nordstrom locations in the US is California, with 83 locations, which is 24% of all Nordstrom locations in America.

Though the number of Nordstrom Rack locations is slightly lower than the department store chain, the entity has been a perennial achiever. In recent times, however, their business model has been challenged by the usual modern-era outside forces: COVID-19, supply chain issues, and inflation among them.

For perspective, according to an archived September 16, 2021 SFGate.com article, “In Rare Move, Nordstrom to Close Outlet Store in San Francisco,” early reasons behind a consideration of new business strategies were disclosed: Nordstrom Rack, a popular spot with bargain hunters, will close its location in San Francisco's SoMa neighborhood on Oct. 1, the retailer said… Our market strategy enables us to look at how we’re best positioned to meet the needs of our customers across a market, rather than looking at individual stores," a spokesperson for the Seattle-based company said in a statement. "This approach means we can combine our digital and physical assets to offer customers an increased product selection, improved delivery speed and increased convenience.

The article goes on to mention the historic rarity of shuttering Nordstrom Rack outlets, while acknowledging recent closures of 16 of their full-line stores: ”Closing Rack stores isn’t something we do all that often," a spokesperson wrote in an email. "We’ve closed just nine since 1995, and in that same time frame, we’ve opened 245."

Does this particular closing, though, represent the beginning of a new trend?

Let us explore.

Nordstrom Rack, 2022

In RetailDive.com’s February 28, 2022 piece, “What Happened to Nordstrom Rack?” little-publicized business challenges were reported for the outlet: Nordstrom executives have long maintained that their off-price business introduces new shoppers to its full-line stores and compounds sales when customers shop both. The company reports on its fourth quarter and full year tomorrow, and observers are watching its Rack results closely because, lately, the business has been stumbling. Rather than boosting the company’s overall performance as it has done for years, Rack sales declined when compared to 2019 in each of the quarters the company has reported so far.

The article elsewhere uses the word “crashing” to describe Nordstrom Rack’s performance. That said, are the weakened numbers expected to be responsible for further closures?

As published on April 24, 2022 by CNBC.com, “Nordstrom Leadership Reclaims Oversight of Struggling Rack Business as Executives Retire,” word of the company’s difficulties were elaborated upon: Nordstrom on Monday announced it is streamlining leadership of its struggling Rack business with that of its full-line department stores, as two executives retire and company veterans reclaim oversight… The company has appointed Ken Worzel, currently chief operating officer at Nordstrom, and Jamie Nordstrom, currently president of Nordstrom stores, to newly created roles as chief customer officer and chief stores officer, respectively. Nordstrom said that by centralizing its customer strategy under one leader and by consolidating the responsibility for its brick-and-mortar stores, it will “better align operational oversight with the company’s Closer to You strategy.”

Though no word of new closures were announced, the company’s stated “streamlining” efforts have led some watchdogs to expect strategic shutterings to be announced in the near-future, as a targeted Google search will verify.

The CNBC.com article goes on to discuss the entity’s revenues: In its fiscal fourth quarter of 2021, Nordstrom reported sales at its Rack business were down 5% on a two-year basis, lagging the performance of its full-price stores. To be sure, that was an improvement from the prior quarter, when Rack sales fell 8% compared with 2019 levels.

For Nordstrom.com’s press release on the matter, see here.

Conclusion

Though no new word of Nordstrom Rack shutterings has been officially reported, the company has acknowledged business difficulties with the outlet, and is taking action to streamline the company.

Conversely, further expansion is underway, with a new location announced as opening in Los Angeles, according to PR Newswire, while ChainStoreage.com reports on an unrelated Riverside, California opening, and a new Phoenix, Arizona location.

Time will tell if additional closings will be announced. If so, I will report those updates here, on NewsBreak.

Thank you for reading.

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I am an award-winning author, screenwriter for film and television, and producer. My mission on News Break is to share socially important perspectives on both culture and pop-culture. Member of PEN America, and the WGA.

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