Some chains may be struggling at least in part because they built too many locations, as did many of their competitors. In some ways, that makes the current retail situation more of a correction than the wholesale shift in shopping that many think it is.

In this segment of Industry Focus: Consumer Goods, Sarah Priestley is sitting in as host and is joined by Motley Fool contributor Daniel Kline to look at what’s happening in retail. The two talk about store closures and why they’re happening, as well as when they may stop. They also look at how malls are changing and what shopping centers will look like in the future.

A full transcript follows the video.

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This video was recorded on April 25, 2017.

Sarah Priestley: On that point about the physical stores and the size, I’m interested to get your opinion on whether all of this space is still going to be saved, because I have an interesting statistic. The U.S. has six times more square feet per capita retail space than the U.K. And obviously, so, that is the availability of space. But that’s a huge amount of retail space. Can all of this be used?

Dan Kline: No. It’s too much. We talked a lot about this — there’s jokes on The Simpsons about the sad mall, but most communities have the sad mall, which maybe has the C-level Macy‘s (NYSE:M) or J.C. Penney as the anchor, and it’s the only mall that has some local stores, and maybe one of those places that sells $49 suits. I think you’re going to start to see — and actually, we talked about this a little bit upstairs — the new mall is going to push out the old mall. You’re going to see closures. There’s a demand for housing, so you’re going to see a lot of conversions. We have too much retail space. There were a lot of articles this week about how difficult it’s going to be to fill the 300-something hhgregg stores. There’s only so many trampoline places that can go into a town, or movie theaters. And yeah, some malls can be anchored by grocery stores. But no, we have too much space, and there’s going to be an absolute pullback in that area.

Priestley:
The concluding thoughts on that basis, then, is that some are going to lose, but generally, if you can target your customer, if you can meet your customer where they’re at, you can still make the most of the space that you have.

Kline:
Yeah. I think you have to do what J.C. Penney is doing and look at your stores, and maybe get rid of some of them. Or change locations. Apple, near where my…