Chain Store Age - July 2009

Retailers Put the Brakes on Economic concerns take a toll on store development

By Marianne Wilson

The current year is shaping up as a difficult one for store development and construction as the eco- nomic downturn forces retailers to cut back on expansion. In a bit of good news, the cost of fix- tures, lighting and other store-outfitting systems is down from last year. These are some of the findings in Chain Store Age’s 2009 Store Construction & Outfitting Survey, an annual study of retail building activity.

The exclusive survey was conducted by Leo J. Shapiro & Associates, Chicago, which compiled results from chains across the nation. The study examined such items as expansion and remodel plans, construction costs, store size, energy costs, and trends in store-outfitting and support systems such as lighting, fixtures, and heating, ventilation and air-conditioning.

This year, the chains that participated in the survey were grouped into five different segments: convenience stores, supermarkets, home centers, specialty apparel and big-box stores (includes department stores). The convenience store group included 7-Eleven, Circle K stores and Stewart’s Shops. The

supermarket category included Kroger, Roche Bros. and Smiths.

National Lumber Co., The Home Depot and The Andersons were among the home centers. Specialty apparel retailers included Jos. A. Bank, Claire’s and Kenneth Cole. The big-box segment included Federated Department Stores, REI, J.C. Penney and Kohl’s.

Overall, the survey polled retailers whose stores produced combined total revenues of $176.6 billion last year. Although the chains that participate in the survey vary year to year, the results can be taken to suggest general trends within the industry.

Expansion: For all retailers surveyed, the average number of store openings planned for 2009 was 13 (per chain) versus 14 in 2008. (All comparisons regarding expansion plans are based on information collected in this year’s survey).

Looking at the individual sectors, convenience stores said they plan to open an average of 19 stores (per chain) in 2009, up from 13 in 2008. Big-box stores plan to open 13, down from 15 last year, while supermarkets plan to open 10, up from eight. Home centers plan to open 10, down from 13.