The start of a new year, and already reflecting on it. Last year was rough with retail as stores close, that's nothing new. What is done to keep it from happening and also to continue happening is not yet explained. On a regular day, I can take a walk through my mall of choice and somehow sense people aren't shopping with a purpose. As the internet craze has consumed our shopping habits, the only way to purchase something now is knowing it will come in a box with a smile on it. As American consumers, we shop all year, the day after Thanksgiving known as Black Friday is the kick off to the biggest shopping season of the year. Between that Friday and Christmas Eve, the stores and malls are packed, and online orders are backed up, we love to spend money and fill our lives with property and tangible goods. Leading up to Christmas, all the stores are closed, the shopping seasons has ended, although the day after Christmas, the stores and malls are packed again, as if a switch was flipped on. Although we flood the return desks, and exchange what we received for what we actually want. I notice even a week after Christmas, everyone has bags in there hands walking through the wings or the mall, I wonder "didn't you get enough for Christmas", we want so much, and the market is in our favor, as consumers, we have reached the highest shopping levels in years. This leaves me with one question...why are the stores still closing?
A chain of stores can go out of business, physically, and still profit very well with online. Many have done it in the past, originally catalog stores like Service Merchandise and Montgomery Ward. The physical stores closed, but the company lead on with there online presence. Circuit City and CompUSA also have done it. Retail companies know very well that online dominates over brick-and-mortar, but change the layout of the store to accommodate the transition of shopping habits. Downsizing is the most common change, square footage of stores shrink, and fill shelves with the most commonly sold items. An employee can recommend to a customer if they don't stock something there looking for, to order it online for them to pick up in the store, the company is still making money, just in different ways. Why waist space on products that don't commonly sell, stock only what people need, a niche item is still offered, but not in quantities that justify shelf space in the physical store. Downsizing keeps a chains profits in the green as less overhead expenses such as square footage, total number of employee's, and assets like amounts of equipment. The warehouses remain the same as there still stocked with all the products, and they can ship it from the warehouse directly to your doorstep and not even make you wait for the stores to receive new inventory as there not going to ship on short in a truck just because you order it!
Relevant to store downsizing, some space is being repurposed for online pick up and drop-off. I am not sure if a term has been coined for what Kohl's and Amazon are doing, customers can now pick-up there Amazon orders and Kohl's orders in a designated space in select Kohl's locations. Whole Foods as well as several malls have a bank of Amazon boxes you can rent with your Amazon account for orders to be delivered and received there. Nordstrom is doing the same with online pick-up as there is a designated space constructed in a portion of the shoe department. Several other chains are doing very similar acts to transition to a variety of selling methods, one biggest factor is to keeping people coming in. The Amazon boxes are in the main entrance of the mall, so if you have to walk into the mall to pick up your orders, likely you will continue into the mall for something...food, a drink, anything, the power of Amazon is being used to keep the"out dated" way of shopping relevant by being incorporating into there business somehow. The Amazon boxes are placed in the dining area of Whole Foods, so supposedly when you pick up you orders, your going to be enticed to getting lunch or dinner, or do your grocery shopping, since after all, your already in the store.
A lot of empty square footage of some malls is being revamped into bigger and better food courts, although being called food pavilion or dining centers. When you don't always need to buy shoes or cloths, you still need to eat, and so many more choices are being offered now to keep people coming for lunch or dinner. Also to keep shoppers in longer, as there is food provided in the mall, that keeps shoppers from leaving for lunch or dinner, thus keeping them in the mall to shop longer. Better lounge areas are being set up and charging stations for people to rest and charge there devices. To the average shopper, these are just pleasantries, but to the analysis, there fighting tactics to keep you coming back. If there is no where to sit and no where to eat, and you don't need to buy cloths because you bought it online, what purpose do you have being in the mall.
As stores continue to close and trends shift to online, other methods of receiving goods and services will soon be prime. The only walls a company will need are the warehouse walls as no physical stores will be needed, or at least satellite stores for order pick up and returns. It is indeed an changing world, for the worst in my opinion, but I guess I am just an old soul, born in the wrong time. Only time will tell of the future of retail shopping, at this rate, its won't take much time at all.
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