More retailers will cut their physical footprints in 2021, according to a new survey of retail CFOs by global accounting firm BDO. Approximately 40% of CFOs surveyed say they are reevaluating their real estate footprint this year, as high unemployment rates and stalled COVID-19 vaccination strategies have brands girding for a lengthy period of reduced consumer spending.

A mere 37% of middle market retailers anticipated increased revenue this year, a sharp decline from 83% of respondents last year in the same category. And only 49% of those polled have enough cash reserves to cover the next three months or less of expenses. Over the last six months, 94% of retailers secured external financing – a significantly higher percentage than expected –and 93% say they plan to in the next six months, with proceeds from a sale or divestment the most likely sources of outside capital.

The US remains "over-stored" – compare an average of 24 square feet per person versus 4 square feet per person in Western Europe – a trend exacerbated by COVID-19 and shelter-in-place orders shuttering brick-and-mortar sales. Temporary rent relief had the ultimate effect of kicking the can down the road, with retailers of all sizes taking a major hit from the fixed costs associated with an extensive physical presence.