Retailers plan to expand further in the years ahead, led by discount chains favoured by inflation-weary consumers seeking deals. Off-price clothing and decor chains Burlington Stores, Ross Stores and TJX, parent of the Marshalls and TJ Maxx store chains, have together added 339 US stores in the past year. Walmart intends to add 150 US locations over the next five years.
“I would say real estate is tight. There’s not a lot of new centres being constructed. And for us, there’s increased interest from other retailers and the types of real estate that we typically prefer,” Michael Hartshorn, group president of Ross Stores, told analysts in November.
The clamour for stores comes despite rapid growth in ecommerce, which enables consumers to shop from home. US ecommerce sales in the third quarter rose 7.5% year on year to US$289 billion, outpacing a 2% increase in total retail sales, according to the Census Bureau.
But ecommerce sales only accounted for less than a sixth of total US sales. Traditional retailers are discovering that stores are convenient hubs for sending out online orders and processing customer returns. Ecommerce titan Amazon has this year added 21 brick-and-mortar Amazon Fresh grocery stores that accommodate both in-person and online shopping.
“If you want to serve as many grocery needs as we do, you have to have a mass physical presence,” Amazon chief executive Andy Jassy said earlier this year.
The strong demand for…
