A Demise Greatly Exaggerated
Tis the season for many things – shopping being one of them. As holiday shopping campaigns ramp up, we can’t help but think about the retail sector – mainly its demise. In recent months we have witnessed the closings of Sears, K-Mart, and Toys R Us. Many other big box types have shuttered throughout the mid-Atlantic – a trend likely to continue. So, retail must be dying right? Turns out, not so much.
Our friends at the Congress for the New Urbanism published data this fall that proves otherwise. First, between 2017 and 2018, the number of retail establishments actually increased nationwide by more the 2,400. Most notable gains occurred since 2011 after rather steady levels year-over-year. What else? Sales are increasing across all retail types. The fastest growth is occurring for restaurants and drinking establishments. And what about E-Commerce? One might think that everyone is buying things online. While it’s true that e-commerce is rising rapidly, it still represents only 14 percent of all retail sales. We still like going to stores.
So, what gives? First, while some big-box stores are closing, others are opening and expanding. Chain restaurants especially are reinventing their spaces and menu to meet new consumer tastes and it’s working. Second, small is big. Boutique shops on main streets are being helped along due to lower lease rates, social media, amazon and consumers wanting to shop local. Third, multichannel marketing is helping to blend e-commerce with brick & mortar stores. Retailers with both strong e-commerce platforms and a place where people can go are winning. This will likely help to reshape how much space is needed in the future and what the shopping experience is in those locations.
Point being, those rumors of retail’s death are highly exaggerated. We are still consuming and eating lots of stuff. It’s how and from whom that’s changing. So, happy holidays, happy shopping and don’t forget to tip your waiter. For more information on the data contained in this article visit https://www.cnu.org/publicsquare/2019/09/23/%E2%80%98retail-apocalypse%E2%80%99-myth-and-thats-good-news-shopping-industry-and-downtowns