Advance Auto Parts is closing more than 700 locations

Advance Auto Parts plans to close over 700 locations in an effort to stabilize its finances after a disappointing earnings report. The retailer, operating around 5,000 stores, announced that these closures are part of a strategy to enhance business performance. The reduction includes approximately 500 corporate-owned stores and 200 independently operated ones. The company has also lowered its full-year outlook, citing economic uncertainty affecting consumers.

In its turnaround efforts, the nearly century-old chain sold Worldpac, an automotive parts wholesaler, for $1.5 billion to simplify its business model. The retail sector is seeing an increase in store closures this year compared to last, with projections for 2024 indicating a potential peak in closures since 2020.

The rise in closures is attributed to the end of a consumer spending boom in 2021 and 2022, coupled with heightened prices and interest rates, making loans and purchases of non-essential items less viable for consumers.