Many of us think of a big chain store first when we need to purchase something but the retail landscape is changing as many big chains face financial difficulty:
Retail is an industry in decline—but only for traditional retailers. For companies that have become successful doing something else, opening a chain of stores can bring millions of new customers and the profits that go with them. This paradox of the retail marketplace is evident in some of the biggest names at the mall. Traditional retailers such as Best Buy, J.C. Penney, Sears, and Kmart are struggling to reverse losses, turn themselves around and give shoppers new reasons to think they’re relevant. The recently announced merger of Office Max and Office Depot is just the latest example of a retail glut that has already sunk Borders, CompUSA, Circuit City, and many others. Yet Apple, a technology company and newcomer to the retail scene, operates a network of more than 200 U.S. stores that have created a new paradigm for brick-and-mortar success. Microsoft, a software company, runs about 60 U.S. stores, with plans to open more. Even Google, an information company, is rumored to have retail ambitions. (US News)
Even giants like Walmart are doing good to get 5% growth:
That sluggish curve is clearly one reason the Arkansas-based company has started devoting so much time and attention to its Silicon Valley operations. Headquartered just south of San Francisco, Walmart.com is heavily recruiting tech talent. And in some ways its investment is starting to pay off. The company’s wide-ranging experiments in “clicks-and-mortar” retail have put it at the forefront of merging online, offline and mobile commerce. (Wired)
Are retail stores doomed as more of us shop online? Thankfully, no.
Just because more people shop online, though, doesn’t mean they’ll stop shopping at stores completely. Indeed, for most retail sectors, a physical store can serve a fundamentally different function, giving consumers the ability to see, taste and touch the products in a way that is impossible online. The challenge for retailers in the future, industry analysts say, will be to figure out a way to play up the strengths of the bricks-and-mortar store while incorporating new technology into the experience. (The Street)
The changing retail landscape does mean everyone involved in city development needs to rethink what “retail” means. For many the word conjures up images of 2-3 massive big box (50,000-200,000sf) stores connected by numerous small (5,000-15,000sf) stores. Those who think of this when they hear retail don’t understand how I can advocate for street-level retail in commercial districts. How will it fit? Parking?
They fail to realize retail doesn’t even need a box. The point is “retail” comes in all shapes & sizes, it’s ridiculous to try to put all retail into the same box. We also can’t fool ourselves into thinking people will ever buy stuff the way they did decades ago. Downtown will never again be the retail center of the region.
– Steve Patterson