According to the Mastercard Economics Institute, consumers across the globe spent $900 billion more at online retailers in 2020 compared with the prior two-year trend.
As shoppers resume traditional in-person dining and shopping, the question becomes: Which shopping behaviors developed during the pandemic will have a long-term shelf life? Let us dig into trends that are having a major impact on the real estate industry to help you maximize your financial position and overall business planning.
This year alone, CNBC reported that TJX (whose portfolio of discount chains includes TJ Maxx, Marshalls, HomeGoods and HomeSense) is planning to open 122 new stores. These openings will bring its total to almost 4,700 locations by the end of the fiscal year.
Burlington Stores, which ended last year with 761 stores nationwide, expects to open 100 new locations in its fiscal year. This expansion will bring its long-term retail store count to 2,000 stores.
Virginia-based Dollar Tree plans to renovate 1,250 existing locations this year while adding 600 new stores, including more of its “combo stores,” which puts its Dollar Tree and Family Dollar brands under one roof.
Dollar General sees the opportunity to roughly double its store count, which stood at 17,177 locations at the end of January.
How Target is Hitting the Mark
In March, Target plans to open 30–40 new stores each year to meet community needs in urban centers, college campuses and dense suburban cities across the country.
In urban centers such as New York City, Los Angeles and Portland, Target will open more small-format stores to reach new guests. In dense suburban areas surrounding cities such as Denver or Brooklyn, Target has identified sites for new mid-size stores to serve new guests that fill retail gaps. Across college campuses, including the University of Georgia and University of Michigan, Target will open new small-format stores to introduce its unique shopping experience to new, college-aged guests to form lifelong relationships.
Parent company Gap, which also owns Banana Republic and Gap, is looking to add 30 to 40 Old Navy locations to meet demand for non-office, smartly priced fashion.
At Home, the Home Décor superstore, is one of the fastest growing retailers in America. Headquartered in Plano, Texas, it currently operates more than 226 stores in 40 states. In February, At Home opened its 101,488 sq. ft. location at the Shops of Nanuet in Rockland county, on the ground floor of the former Macy’s department store.
The retailer plans to grow its chain to more than 600 stores over next few years.
Despite the obvious shift toward online grocery shopping during 2020, several retail grocers plan to expand their in-person presence.
Chain Store Age reported that Aldi, the German discount grocer, is adding 100 U.S. stores in 2021, with locations focused on Arizona, Florida, California and the Northeast. Lidl, another German discount grocer, plans to open 50 new stores by the end of 2021, with locations in Delaware, Georgia, Maryland, New Jersey, New York, Pennsylvania and other nearby markets.
Bloomberg.com reported that Amazon is quietly opening more Amazon Fresh grocery stores. Amazon Fresh debuted in Los Angeles in September. The Bloomberg report said the eleventh such store opened in March, and Amazon is working on at least two dozen more. The Fresh stores range from 25,000 square feet to 45,000 square feet.
As many turned to at-home fitness in 2020 with the closing of several gyms, Dick’s Sporting Goods it tapping into this trend in addition to encouraging in-person activities. The company plans to open six new namesake stores this year, as well as six locations that will test fresh concepts. In the coming weeks, for example, it is slated to open a first-of-its-kind experience-heavy location in Rochester, New York, called House of Sport, which will feature a track and field outside as well as an indoor climbing wall.
Dick’s Sporting Goods has a little more than 850 locations today, according to its website. Along with its off-mall sporting goods stores, the retailer operates Golf Galaxy and Field & Stream.
Beauty retailers Sephora and Ulta Beauty are planning major expansion this year. Chain Store Age reported Sephora is embarking on the largest store expansion plan in its 21-year history in the U.S.
They will open more than 60 freestanding “client-centric” stores and 200 locations in Kohl’s this year. New stores to open in New York, New Jersey, Ohio, Chicago, Minneapolis, and Wisconsin. The in-store shops will average about 2,500 sq. ft.
Ulta Beauty is expanding its footprint in partnership with Target. The two retailers have entered a deal to open Ulta-branded makeup and skincare shops inside hundreds of Target stores nationwide. They plan to open 100 stores in Targets in 2021, with hundreds more locations in coming years. The company has also announced plans this year include 40 new stores and 21 remodels or relocations.
With the rapid expansion in the economy and planned recovery from the pandemic, retail is expected to grow in 2021.