The New York Times reports this morning that it isn’t just the likes of Walmart and Target that are looking at small stores as the next big retail trend.
Indeed, the story suggests that a number of companies - from department stores like Bloomingdales to specialty stores like Nike and Charlotte Russe - are “among a growing number of retailers thinking small — chopping off big chunks of stores or moving to more efficient spaces. The change reflects two trends in the retail world: Chains looking for new ways to cut costs in the sour economy, and consumers demanding a less sprawling shopping experience as they spend with greater purpose ... The smaller stores help clean retailers’ balance sheets. Rents drop, and smaller amounts of inventory cost less. Retailers can also reduce payroll costs because fewer employees are needed.”
“The customer walks in the door, and often sees a huge selection of stuff in a multibrand store, and can’t figure out what to buy and ends up buying nothing,” Paco Underhill, founder/CEO of Envirosell, tells the Times. “We have reached the apogee of the big box, meaning that we can’t grow the store or the shopping mall any bigger, or get any more time or money out of somebody’s pockets.”
Indeed, the story suggests that a number of companies - from department stores like Bloomingdales to specialty stores like Nike and Charlotte Russe - are “among a growing number of retailers thinking small — chopping off big chunks of stores or moving to more efficient spaces. The change reflects two trends in the retail world: Chains looking for new ways to cut costs in the sour economy, and consumers demanding a less sprawling shopping experience as they spend with greater purpose ... The smaller stores help clean retailers’ balance sheets. Rents drop, and smaller amounts of inventory cost less. Retailers can also reduce payroll costs because fewer employees are needed.”
“The customer walks in the door, and often sees a huge selection of stuff in a multibrand store, and can’t figure out what to buy and ends up buying nothing,” Paco Underhill, founder/CEO of Envirosell, tells the Times. “We have reached the apogee of the big box, meaning that we can’t grow the store or the shopping mall any bigger, or get any more time or money out of somebody’s pockets.”
- KC's View:
-
All of which makes sense. Until it doesn’t anymore.
The most important thing to keep in mind about these kinds of trend declarations is that everything changes. Constantly. Nothing is forever.
So small is in for the moment, and the moment could last a long time or be short-lived. But that doesn’t mean you don’t try to cash in on and exploit the trend. It just means you have to be nimble and open-minded enough to feel the shifts happen before they actually do.
