As reported by Reuters and other news outlets, FAO Schwarz, the oldest toy store in the U.S., is closing its iconic Fifth Ave. flagship store in Manhattan, citing rising rent prices. The store will shut its doors on July 15, exiting early from its lease.
According to a new Nielsen survey, reported by Reuters, more than 40 percent of retailers reduced the number of different SKUs on their shelves last year, and nearly the same number expect to make additional cuts.
According to Nielsen, these cuts can help retailers lower costs, but shoppers may leave stores without making a purchase if they cannot find a specific item. In the Nielsen survey, it was reported that 7 percent of shoppers who did not find their desired personal-care item said they would leave the store without buying an item in the category, with some shoppers saying they would leave the store without buying anything. Nielsen reports that if just 0.5 percent of grocery shoppers were to leave a store without making a purchase, retailers could lose sales up to $1.5 billion.
Walmart recently reported that its program to overhaul stores hurt sales. Last year the retailer removed slower-selling items from shelves, and replaced them with more popular items. However, the company found that not offering some items drove shoppers to other stores. In March, the company said it returned approximately 300 items to U.S. store shelves.