This year, thousands of retail outlets across the US will shut their doors as companies rationalise their store portfolios in the teeth of the worst recession since the Second World War. But is this a necessary correction, or an overreaction? And how will the retail landscape look once "normality" returns - whatever that means? asks Richard Woodard.

When you've got a few minutes to spare, use just-style's excellent search and archive facilities to check on recent retailer updates from the US - and then tot up just how many stores companies are closing or planning to close during 2009.

It's not exactly an exercise in positive thinking - I gave up at about 1,000 stores after going back just a few months - but it does illustrate the massive adjustment currently under way in the sector.

Tween Brands, Ann Taylor, Brown Shoe, Gap, Aeropostale and Talbots are all cutting back - but it would probably be easier to list those companies not currently planning to shutter stores.

Blaming this retail transformation on the recession is understandable, but excessively simplistic.

Rising unemployment and falling consumer confidence are merely the catalysts for change, with the real reasons much more deep-seated.

"This retail downturn is really no surprise," says Marshal Cohen, chief industry analyst at The NPD Group.

"It is something that retailers have been able to hold off for quite a while now. Retail needs to go on a diet. It is bloated. We have too many stores."

"Acquire or hire"
How did this happen? Put simply, it's a consequence of badly managed capitalism: in order to maintain growth in a mature market, retailers were forced to "acquire or hire" - that is, to buy up their rivals or open up new outlets and employ new staff.

That's fine as long as companies stay dynamic, refreshing their consumer offer, and as long as their customers have money to spend.

But remove one or both of those factors and the cracks begin to appear.

"In many cases, we see too many of the same stores in one mall or shopping area," says Cohen.

"And even worse, we see too many of the same stores in close proximity to one another... Do we need 42 stores selling footwear in the average shopping mall?"

Quite apart from the cannibalisation of sales that is an inevitable cost of such an environment, there is also the additional cost of maintaining extra stores and additional staff numbers.

These costs are generally easily absorbed in the good times, but quickly become a millstone around the retailer's neck during a downturn.

Cohen and many other industry observers believe that the consequent correction in store numbers, while exacerbated by the economic conditions, would have come anyway - just not as fast and not as hard.

"The real issue here is that when retail was growing, staff growth and merchandise purchases growing didn't make news," Cohen adds.

"It happened steadily and quietly. Now that the shoe has dropped and made a big thud, we are seeing the extra deep drop, due to the extra long climb it made in the good years."

Consumer spending upswing
For some, the rationalisation is part of a cycle linked to consumer spending power and confidence, and one that will begin an upswing once more, either later this year or early in 2010.

But the deeper causes of retail reduction suggest that this is more than a temporary correction - and there are other factors that support this view.

Analysis by Retail Forward in association with PricewaterhouseCoopers suggests that the recession has significantly altered consumer behaviour - and that these changes may well endure beyond the end of the current downturn.

Retail Forward describes three types of consumer behaviour - "limiting" (ie making do with less), "deal-seeking" and "trading-down".

It continues: "The habits learned during this economic crisis have the potential to permanently alter the mindset of consumers."

And, most tellingly: "The vast majority of shoppers who are changing their near-term shopping behaviours say they plan to continue them as the economy improves."

Some caution is needed here. It's easy for people to make virtuous promises in surveys about future behaviour - but human nature doesn't always back up those promises with action.

Nonetheless, Retail Forward believes the length and depth of the current recession will give shopping habits plenty of time in which to become entrenched.

If this analysis is correct, it will not be possible for large-scale retailers to return to growth by simply opening more stores in the US.

Instead, they may be forced to revisit their earlier "acquire or hire" strategy, but this time on an international basis - opening stores and buying companies in other countries.

And this is already beginning to happen on a relatively small scale.

Smart thinking
For the apparel and footwear brands which supply these retailers, there are obvious pressures: fewer stores mean fewer distribution points for their products and therefore tougher routes to market.

These companies will have to think smart to stay ahead - with innovative deals like People's Liberation's exclusivity agreement with Charlotte Russe the shape of things to come.

What is more, apparel and footwear retailers face additional pressures.

Retail Forward predicts that the softgoods sector will be the hardest hit and slowest to recover of all retail sectors.

Forecasting a rebound in 2010, it nonetheless warns of continued and increasing competition from supercentres, warehouse clubs, e-commerce and non-store retailers.

Consumers have not stopped spending - already, in January and February, they have returned to stores to pick up necessities, plus selective replacement of old or worn-out items.

The next step is a return to impulse purchasing - but not, Cohen believes, a return to the way things were.

"We are going to see yet again 'a new normal'," he predicts.

"The stock market is already showing some signs of life. The housing market is getting a pulse and the consumer is going to have to shop this back to school season, so life will come back to retail.

"But it will be a new life. A trimmer, leaner retail environment."