Professional Retail Store Maintenance 2018 Trends Report - 7

2018 PRSM Trends Report

WHAT'S DRIVING RETAIL TRENDS

Retail Transitions from eCommerce to NewCommerce

Pamela Flora
Director, Americas Retail Research
Cushman Wakefield
As news of store closures and retailer
bankruptcies continue, so have concerns
about the fate of brick-and-mortar retail -
prompting the persistent use of the term
"retail apocalypse" across media outlets.

chain closures, up from 3,600 closures in
2015. This year's closure pace will likely
double last year's, and those figures are
expected to increase in 2018.

THE NEWCOMMERCE

But don't let the doom and gloom fool
you: these trends are not affecting all retail
categories across all shopping center types
in the same way, and some categories are
growing - even in the apparel arena. While
Amazon now presents a tangible threat
for department stores and apparel brands
by offering convenience, other off-price
retailers have stepped into the value space
and are in expansion mode.
These include: Macy's Backstage
discount concept, Nordstrom Rack, Saks
Off 5th as well as TJX brands, Ross and
Burlington Coat Factory. Dollar stores
continue to have the most ambitious
expansion plans with Dollar General
reportedly opening 1,000 new locations in
2017 and Dollar Tree/Family Dollar planning
650 new stores this year. Both companies
are also expanding within the grocery
arena by incorporating more freezer and
refrigerator space within their stores.

Stated more simply, the retail industry is
in the midst of an evolution. To keep pace,
landlords and tenants alike must adapt and
reevaluate real estate strategies against
investments in industrial property and
logistics, supply chain enhancements, and
digital and omnichannel strategies - an
approach we at Cushman & Wakefield call
newCommerce.
It's undeniable - online sales have
accelerated at an aggressive pace the last
few years. In 2016, e-commerce sales
accounted for 8.3 percent of total retail
sales in the U.S., and almost 30 percent
in the General Merchandise, Apparel and
Accessories, Furniture and Other Sales
(GAFO) categories.

eCOMMERCE DISRUPTION
As the e-commerce disruption
reaches one retail category after another,
bankruptcy announcements by failing
brick-and-mortar players within those
categories follow, as well as increased
strategic closures from other retailers in
that space. Throughout 2016, Cushman &
Wakefield tracked more than 4,000 major

NOT ALL DOOM AND GLOOM

FOREIGN INVASION IN GROCERY
In the grocery sector, growth from
German-based grocers, Aldi and Lidl,
will introduce hard discounting as a real
contender among traditional players. Aldi

has announced an aggressive 900-store
expansion that would increase total
store count to 2,500 stores by 2022, and
would make them the third largest grocer
in the U.S. based on store counts, after
Walmart and Kroger.
Lidl made its debut in the U.S. in June,
with plans to add 1,000 stores by 2021.
Though e-commerce disruption in the
grocery category has been minimal, the
recently-announced Amazon/Whole
Foods merger will push this category into
a new stage of evolution.
While this will likely increase the
e-commerce percentage for grocery
sales, there's good news for landlords:
because of the cost of final-mile
distribution for perishable goods,
successful grocery operators still need to
deliver from sites close to the consumers.
That means most existing brick-andmortar locations will serve as distribution
centers, as opposed to larger, industrial
distribution centers.
There's no question retail is changing.
New concepts, technologies and
distribution strategies are radically
changing the way Americans consume,
and will continue to do so as new
innovations disrupt the sector. To survive,
the best and most agile brands will
embrace these changes - and engage
creative newCommerce strategies - in
the months and years to come. l

www.prsm.com I 2018 TRENDS REPORT I 7


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Table of Contents for the Digital Edition of Professional Retail Store Maintenance 2018 Trends Report

What’s Driving Retail Trends – Retail Transitions From Ecommerce to Newcommerce
The Skills Gap Crisis
A New Era of Retail
Making the Mark
FM Tech Trends – Tapping Into Tomorrow Today
Direct to the Customer – Retailers Streamline Fulfillment
Contributors
Advertisers’ Index
Professional Retail Store Maintenance 2018 Trends Report - Intro
Professional Retail Store Maintenance 2018 Trends Report - cover1
Professional Retail Store Maintenance 2018 Trends Report - cover2
Professional Retail Store Maintenance 2018 Trends Report - 3
Professional Retail Store Maintenance 2018 Trends Report - 4
Professional Retail Store Maintenance 2018 Trends Report - 5
Professional Retail Store Maintenance 2018 Trends Report - 6
Professional Retail Store Maintenance 2018 Trends Report - What’s Driving Retail Trends – Retail Transitions From Ecommerce to Newcommerce
Professional Retail Store Maintenance 2018 Trends Report - The Skills Gap Crisis
Professional Retail Store Maintenance 2018 Trends Report - 9
Professional Retail Store Maintenance 2018 Trends Report - 10
Professional Retail Store Maintenance 2018 Trends Report - 11
Professional Retail Store Maintenance 2018 Trends Report - A New Era of Retail
Professional Retail Store Maintenance 2018 Trends Report - 13
Professional Retail Store Maintenance 2018 Trends Report - 14
Professional Retail Store Maintenance 2018 Trends Report - 15
Professional Retail Store Maintenance 2018 Trends Report - Making the Mark
Professional Retail Store Maintenance 2018 Trends Report - 17
Professional Retail Store Maintenance 2018 Trends Report - 18
Professional Retail Store Maintenance 2018 Trends Report - 19
Professional Retail Store Maintenance 2018 Trends Report - FM Tech Trends – Tapping Into Tomorrow Today
Professional Retail Store Maintenance 2018 Trends Report - 21
Professional Retail Store Maintenance 2018 Trends Report - Direct to the Customer – Retailers Streamline Fulfillment
Professional Retail Store Maintenance 2018 Trends Report - 23
Professional Retail Store Maintenance 2018 Trends Report - 24
Professional Retail Store Maintenance 2018 Trends Report - Contributors
Professional Retail Store Maintenance 2018 Trends Report - Advertisers’ Index
Professional Retail Store Maintenance 2018 Trends Report - cover3
Professional Retail Store Maintenance 2018 Trends Report - cover4
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