We are not normally in the business of predicting the future, but because there are many dramatic changes taking place in the world at the moment and because we have been asked a number of times by a number of clients recently, we thought we would outline some internal thoughts we have on what might happen in the world of retail during the coming years. Some of this might seem obvious, and there are bound to be things we have missed, but the intention is to revisit these in two years to see how we did.
Macro Retail Changes
Economic factors will continue to have a significant impact on the retail industry in the U.S. during the next 24 months.
We expect to see:
- Further consolidation as retailers with strength buy their weaker counterparts to drive growth through acquisition. Manufacturers will need to provide leadership and intellectual property to the retailer to gain influence. Bigger business-building ideas for retailers will be required on a more regular basis.
- Further store closures through both the bankruptcy of retailers and reduction in footprint as retailers close underperforming stores. New development and building will be limited. We are unlikely to witness much expansion. Plenty of retail property will lie dormant for some time. Strong stores and locations will get stronger.
- Changes in the nature of formats. Any potential development will likely be concentrated on larger retailers developing smaller, more personalized, and locally relevant formats.
