Reports of the death of physical stores seem to be greatly exaggerated. Don’t believe it? Ask TJX, the dollar stores, Five Below and lots of other retailers.
In the midst of perhaps the biggest prolonged shutdown of physical stores in retailing history a number of companies have announced aggressive expansion plans in their footprints over the next few years. This does not come at the expense of the ongoing market share gains being made by e-commerce but instead are viewed as a reaffirmation of the role of in-person shopping particularly as so many other stores are shuttered.
Even with the hundreds of new stores coming to the retail landscape the total still pales in comparison with the tens of thousands that have gone away since the pandemic first took hold of the economy 15 months ago. Yet, they do show that the retailing industry is still very much committed to the physical store. Though digital sales are surging towards the 25% mark in overall revenue, it still means three-quarters of buying activity continues to take place in physical stores. Add in the omnichannel role stores play in processes like curbside pick-up, BOPIS, same-day deliveries and online order fulfillment and they become even more valuable.
In the meantime, the store opening announcements are piling up:
TJX: The parent company to the country’s biggest off-price brands is moving on all fronts to expand its store base. Long-term it has said it will nearly double the number of HomeGoods units from its current 800-store count to 1,500. Short-term, the company plans to open 76 stores in the U.S. across its multiple banners in its fiscal 2022.
Dollar Tree DLTR +0.7%: Continuing its torrid pace of the past few years, the company said it expects to open 600 stores this year, 400 under its namesake banner and 200 under its Family Dollar subsidiary. That’s up from 400 last year. Included in this count will be 50 of its first combo-stores putting both brands into one building, primarily in smaller, rural markets that might not be able to support full-size individual locations.
Dollar General DG +1.1%: Not to be outdone, this dollar chain is expected to continue its recent surge with around 1,000 new stores this year. That’s on top of its existing 16,000 locations. For both dollar operations it should be noted that there will be any number of store locations over the year that will impact their total counts.