NEW YORK (CNNMoney)
Staples will close 225 store in north America by the middle of next year as the office supply retailer tries to trim costs in the face of weaker sales.
The store closings will come to about 12% of its stores in North America. The closings build upon the 40 stores it closed in the region in 2013. Staples said it is aiming to save $500 million annually through the closings and other cost cutting measures.The announcement comes two days after electronics retailer Radio Shack (RSH) announced plans to close up to 1,100 stores, or about 20% of its locations.
Staples also reported that lower sales and earnings in its most recent quarter that ended Feb. 1., a period that included the holiday shopping period. And it warned that sales and earnings would be lower again in the current quarter, missing forecasts of analysts.
Staples is facing increased competition from Office Depot (ODP, Fortune 500), which purchased smaller rival OfficeMax during 2013. The combined operations of the two chains now have more locations in North America than Staples, even though Staples is still larger in terms or sales.
Office Depot could be announcing its own store closings in the future as it deals with overlapping locations in the same market produced by the merger.