The Pain Ahead for Retail Chains

It's been a bleak year for the brick-and-mortar retail industry. Stock prices and earnings have fallen. Store closures are being announced. The Amazon threat continues to grow, both via e-commerce efforts and now, with the acquisition of Whole Foods, as an established physical chain. But it's a mistake the blame Amazon and leave it at that. To look dispassionately at what's plaguing the retail industry and how it can fix its problems, consider a surprising historical parallel: the airline industry.

In the 2000s, the airline industry was in terrible shape. US Airways and United Airlines filed for bankruptcy in 2002 in the aftermath of September 11th. Delta Air Lines and Northwest Airlines filed for bankruptcy in 2005, plagued by rising oil prices and competition from low-cost airlines. American Airlines filed in 2011. Anyone who suggested during that period that the industry would one day thrive would have been laughed at.