Oh, hell. Why hide it. I'm a business geek.
The Keypoint Partners Retail Roundup site is fascinating to me.
I'm just going to geek out on it.
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First article, (Drug Store News): National Retail Federation forecasts slow sales through the holidays.
“We don’t see a turnaround until, at the earliest, the second half of next year and even that may be optimistic.”
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Next article, (Yahoo.com): Walmart converts more than 1700 Garden Centers into Game Time Headquarters.
Turning seasonal dead space into useful space. "...customized for supporters of local college or professional football teams." Seems smart to me.
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Next article, (The Mac Observer): Apple Stores generally mirror U.S. Population density.
Especially interesting are the maps, showing the dead zones for Apple stores, almost the entire great basin and southeast. Apple is more inclined to open more stores in high population areas they already have stores in, than open in less populated areas without an Apple store.
From my own experience in a less populated area, I'd follow Apple's example if I was going to create a chain. A small personal example is how my two little stores in Bend did better than exclusive stores in Redmond and Sisters.
My advice to any new business? Go for the population.
Or -- forget my advice. Live in Bend. Poverty with a view.
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Mid-Tier Retailers try new brands for size. (Washington Post): The upshot of this article is that the mid-tier retailers, J.C. Penney, Dillards, Kohl, are having trouble holding their own against the discount stores and the luxury stores. Their solution is to create multiple brands, "private labels."
Oh, boy. I know how that ends. Damned if they do, damned if they don't. They'll flood the market fighting for space and end up driving everyone away.
Interestingly, Kohl's sales are down 10% -- just in time to open in Bend.
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Real Estate Recovery Expected in 2011.(National Real Estate Investor.): Oh, that's good. No...wait. That's three years from now!
They're talking commercial real estate here.
I especially liked this line: “In the real estate business we don’t care what GDP is,” Dotzour quipped in a forecast presented to members and guests of the Real Estate Council of Austin on Aug. 18. “All we’re interested in is job growth, and we’ve had negative job growth in the U.S. now for about eight months. I call that a recession.”
This mirrors what I've been trying to say about Bend. It's the jobs that count, and with only 27 building permits being issued a month, we're in for a long slow period. Frankly, I could give a rip about housing 'prices.' My customers come either through tourism or locally, and I'm pretty sure a large percentage of the locals are affected by the slowdown.
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Sears profit drops 62%,outlook weak. (Chicago Tribune.): This includes poor old K-Mart. Say no more.
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Talbot's 2Q loss swells...(Chain Store Age.): Again, say no more.
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Border's hits store opening goal. (GlobeSt.com): Essentially seems to be saying that Borders went ahead and opened the stores they couldn't cancel.
Borders has "new concept" stores "...which reduces the space allocated to music, giving that space to children’s and bargain books."
My understanding is that this includes quite a few graphic novels.
Also, they have kiosks for internet ordering. This seems to me to be the big store equivalent of a small stores saying "We'll order it for you." Good luck with that.
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Gap cutting square footage... (GlobeSt.com): And finally, this amazing statement by the CEO of Gap: "We see no reason for optimism and are managing our business accordingly.”
Well, I can't top that.
I could go on and on with these articles. I'm going to let my business geek flag fly.
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5 comments:
Your approach to opening stores for a new chain is exactly the opposite of the approach taken by Walmart as they grew from a small regional chain to a major retail chain. Their strategy was to put stores in towns that where considered to be too small by their competitors (which at the time was primarily K-Mart and the catalog stores such was SEars and JC Penny, etc). What they did was establish the store and then as the area crossed over the population level to where it became of interest to the competition Walmart was already established and it made it difficult for the competition to move in. So they took the exact opposite approach they went for small-medium towns and only after they established a strong national presence did they move into the higher density population areas.
True.
Nevertheless, I'd still go for the population.
You know, if it was my money and time and I was younger and ambitious, and I didn't care where I lived, why not situate in a populated area, where you could expand properly and orderly.
Even Oregon isn't big enough, or Washington.
California and back east.
Because if you do a good job, you have a chance of snagging customers.
I'd rather have 2% of ten million, than 100% of 100k.
Great post, Duncan. It's good to get your take on retail/business trends.
@ Duncan: You wrote, "Also, they have kiosks for internet ordering. This seems to me to be the big store equivalent of a small stores saying `We'll order it for you.' Good luck with that."
Many a time I've looked for a book at (my former) Barnes and Noble. When not in stock, they offered to order it for me. I can order books myself and I order them used. I dislike paying full price for a new book. Not that I think that the publisher et al deserve less than full boat for their product, but because there are few books that I want to read a second time so it feels like a profligate waste of money and resources.
On the other hand, if I have a jones for a book and the shop has a copy, I don't mind paying the asking price. After all, they took the time and trouble to get the book in (and guessed right about what Jack might buy).
Take care of your inner geek. Whether one geeks out over business or stamps or audio gear or computers or maps, geekery is, bottom line, fun.
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