Size Matters

31 10 2011

American retail is a strange scene. For decades business has been fixated on the idea of bigger-is-better. Almost as if they were all from Texas and had adopted our apparent motto. Supermarkets slowly got bigger and bigger…growing from 15,000 items 40 years ago, to 30,000 20 years ago, and now 45,000 individual items.

As if you have tried even 1/100th of them. At least we have enough yogurt choices to keep us in variety for a few months at a time. What in the world would we do without it?

Back in the early-1990s, Walmart launched its supercenters, with stores ranging from 190,000 to 220,000 square feet. Actually, these were a slightly pared down version of Walmwart Hypermart concept stores (2 in the Dallas area, and 2 in Kansas City), each over 220,000 square feet). Those test stores did not fare well, so Walmart spared us all by trimming a little fat.

Lucky us.

About the same time, the Tandy Corporation (ever heard of Radio Shack?) launched Incredible Universe. I actually bought a stereo system at the Arlington store. It was a sight to behold. In fact, it was a universe…the universe of every known electronic product at the time. The store sank from the weight of its inventory, and disappeared within a matter of a few years. Thankfully.

But all of a sudden, a perfect storm of bad economies, in-migration to city centers, over-storing and e-commerce have collided to force many chains to reconsider size. Small is the new black, as long as it includes food. Walmart and Target are leading the charge of the “lighter” brigade, with Best Buy also shedding a few square feet at many stores.

Which is another way of saying that change is inevitable. Even in the opposite direction.

Walmart is forging ahead with its Neighborhood Market stores (often 25,000-30,000 square feet), as well as downsized urban stores shoe-horned into major metros like Chicago and New York. Target is doing likewise. Walmart is even trying its hand at convenience stores.

And you know what? I say it’s about time!

I am completely head over heels in love with the idea of less-is-more. I am tired of walking miles in sprawling supercenters. I would rather buy more and more of my stuff online. And I would rather my time be spent on me…not mundane repeat purchases.

Even when the stores are still large, it is possible to use space wisely. A new two-story Walmart/Sam’s Club in the Dallas area reduces the footprint by 50%. The multistory Target in downtown Minneapolis is an urban shopper’s dream. And being able to simply find what you really need without spending an hour wandering aimlessly under the mesmerizing bright lights is worth its weight in lumens.

I’m just glad the big chains agree, albeit for different reasons. Walmart and Target must figure out how to squeeze into crowded urban spaces. Furthermore, land is expensive everywhere, so building smaller is more efficient.

Martin Lindstrom, in Brandwashed, repeats an oft-cited fact: shoppers often become paralyzed when confronted with too much choice. How in the world Big Retail ever thought that more choice would be better for us (and them) is beyond comprehension. The fact of the matter is, most of us just get confused when we have 90 yogurt options from which to choose. But when we have 10, we actually become much more decisive.

Wow. The implications are huge. Carried forth to our closets, it means we really don’t need that many shirts. Pants. Shoes. (Ladies?)

OK, I better duck right about now. And I will confess, as a man-card carrying kind of guy, to every once in a while reaching a fashion paralysis while perusing a few dozen clean and ironed dress shirts. “Where the heck is that black shirt with the button-down collar? The rest of these just won’t do.”

Sure, taken to its extreme, this trend could spell real estate trouble in the years ahead if we all decide we want to shop at smaller stores. Just as we are still trying to absorb all those midsize Walmart building abandoned after the move to supercenters, we could find ourselves living amid a slew of empty retail behemoths.

That’s a problem for another blog to solve. But for now, it wouldn’t bother me a bit if I never walked another mile inside a Walmart. Literally.

Dr “Retail Diet” Gerlich


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