The year 2025 witnessed a significant surge in bankruptcies, leading to the closure of numerous well-known national and regional retailers as they faced an increasingly challenging economic landscape. Throughout the United States, over 8,100 retail stores shut their doors this year, marking an approximate 12% increase compared to the previous year, as reported by Coresight Research, a firm specializing in retail analytics. Here’s a closer look at some of the prominent retailers that ceased operations in 2025.
Bargain Hunt
In February, Nashville-based discount retailer Bargain Hunt announced that it would close all of its 92 locations across ten states after filing for bankruptcy. This decision came as part of a massive liquidation sale, which indicated the company’s struggles amidst the competitive retail market.
Forever 21
The fast-fashion brand Forever 21 decided to end its U.S. operations, largely due to fierce competition from overseas brands like Shein and Temu. The company's management pointed to the advantages these foreign rivals have in pricing and margins, citing "competition from foreign fast-fashion companies, which have been able to take advantage of the de minimis exemption to undercut our brand on pricing and margin."
Joann Fabrics
Hudson, Ohio-based Joann Fabrics made the heartbreaking announcement in February that it would permanently close all of its stores after more than eight decades of serving customers with fabrics and craft supplies. Following a second bankruptcy declaration in January due to declining sales, the chain could not find a buyer willing to keep the stores operational, which led to its unfortunate exit from the market. In a statement, Joann emphasized the "significant and lasting challenges in the retail environment" that contributed to its downfall.
Liberated Brands
Liberated Brands, known for its wide range of sports and outdoor apparel, also announced in February that it would close all 122 of its stores. Based in Costa Mesa, California, the retailer’s portfolio included popular brands such as Beachworks, Becker Surfboards, Billabong, Quiksilver, and Volcom.
Party City
Party City faced severe difficulties, resulting in the closure of numerous company-owned and franchise locations after declaring bankruptcy in late 2024. While some independent franchise stores are still operational, the brand now primarily exists as an online retailer following its acquisition by Ad Populum in early 2025, which aimed to preserve its legacy in the party supply industry.
Rite Aid
The well-known pharmacy chain Rite Aid, which had been in business since 1962, announced in October its decision to close all locations after enduring two bankruptcy filings within the span of just two years. The chain attributed its struggles to sluggish sales and exorbitant costs linked to opioid-related lawsuits, which included a complaint from the Justice Department accusing Rite Aid of violating laws regarding controlled substances.
Sonder
In a surprising turn of events, Sonder, which once competed with Airbnb in the short-term rental sector, abruptly shut down its operations in November, leaving many guests stranded or locked out of their accommodations. The company's troubles were exacerbated when Marriott terminated its licensing agreement with Sonder, leading to unforeseen integration issues and substantial financial losses, as highlighted by interim CEO Janice Sears in a recent statement.
Conclusion
As we reflect on these closures, it’s evident that the retail landscape continues to evolve rapidly, often leaving established brands struggling to adapt. The reasons behind these failures range from fierce international competition to changing consumer behaviors and economic hardships, raising important questions about the future of brick-and-mortar shopping. What do you think contributes most to the decline of these iconic brands? Are there ways we can support local businesses to prevent similar outcomes? Share your thoughts in the comments!
