Brick-and-mortar retail is alive in 2022, with more than twice the number of new store openings compared to store closures through the first seven months of this year. Coresight Research reports 4,432 new store openings compared to 1,954 store closures equaling a net gain of more than 49 million square feet of new retail space.
Store closures have slowed since the same period of 2021, when retailers announced 4,130 closures. Store expansion also slowed from a year ago with 4,554 new store announcements.
Analysts said many retailers seek to right-size store holdings, which may mean a mix of closures and openings. Retailers are also experimenting with new formats as shopping behaviors continue to evolve.
Athleisure specialty retailer Athleta, owned by Gap, is among those adding stores in 2022. Athleta said it’s on track to open up to 40 new locations this year, including its first two outlet stores in Chicago this summer, and Leesburg, Va., scheduled to open this fall. The outlet locations aim to reach new customers looking for value in at-leisure apparel.
“Our new outlet stores are intentionally designed to stand out from traditional outlet and clearance store models, helping drive new customer acquisition and increased brand awareness for Athleta,” said CEO Mary Beth Laughton.
The off-price retail sector is also expanding, with more stores this year. TJX announced plans to open 150 new TJ Maxx stores in 2022 in the U.S. on a base of nearly 4,700 stores. Burlington plans to open 90 new stores on a base of about 840 stores, and Ross Stores plans to open 75 Ross Dress for Less Stores and 25 of the DD’s Discount banners this year on a base of more than 1,900 total stores. Ross opened 65 U.S. stores in the last year.
Earlier this year, discounter Five Below outlined an aggressive new store plan with 1,000 new locations by 2025. The plans called for between 375 and 400 new brick-and-mortar stores this year and next, with the balance of stores opening in 2024. Former Walmart executive Joel Anderson is the CEO at Five Below. He said that the business was well positioned in June from an inventory standpoint, with improved in-stocks and accelerated receipts for summer and back to school.
“With the planned openings and conversions in scale this year, we are on track to end the year with nearly half of our stores in the new Five Beyond format. We are capitalizing on real-time opportunities in the marketplace, including merchandise and real estate, while piloting new products and services that embody the rituals of life and milestones of growing up,” Anderson said.
He said the macro environment looks challenging through the balance of 2022. Coresight CEO Deborah Weinswig said discounters like Five Below should be in a strong position if the economy slows.
“Shoppers watching their budget can still feel good about themselves when they find bargains at $5,” Weinswig said.
The dollar store segment leads the retail sector in new store announcements again this year. Goodlettsville, Tenn.,-based Dollar General plans to open 1,102 stores this year. That will equal 11.7 million new square feet of retail square footage. Dollar General is also experimenting with a new format called Popshelf, a concept that offers accessories, decor, cosmetics, party items and household supplies at prices of $5 or below. The first 30 Popshelf stores opened last year, with more than 200 new locations on tap this year.
Virginia-based Dollar Tree also has a growth plan to add 590 new stores with 800 Family Dollar renovations this year. Dollar Tree is experimenting with a Family Dollar-Dollar Tree combo format in rural south Arkansas areas like Lake Village and Hope. The company said 350 new Family Dollar stores would be the combo format.
Walmart is also experimenting with a new store format in a partnership with hospitality group Getaway for tiny general stores at campsites across the country. The first Walmart general store is slated to open in September in Wimberly, Texas, south of Austin. Walmart said the partnership also plans for general stores in Moodus, Conn., Running Springs, Calif., Roscoe, N.Y., and Osceola, Mo.
The “General Stores” concept will be on wheels in small, wooden, slope-roofed cabins. Walmart’s name and starburst logo are in yellow, in smaller print, under signage saying The General Store. The store’s tote bags say, “Quality Goods, Great Outdoors,” with Walmart in a smaller font. Inside are rustic wooden shelves displaying a small, heavily curated selection of goods.
“Walmart’s partnership with Getaway furthers our mission to help people live better no matter where they are,” said Casey Schlaybaugh, vice president of brand marketing for Walmart U.S. “We are going beyond just saving people money by enabling guests to maximize Getaway’s experience and empowering them to spend more quality time with those who matter most.”
Items sold at The General Store will also be sold on Walmart.com via a particular Getaway shopping page. And those who visit Outpost over the next year will receive a free trial of the retailer’s membership program, Walmart+, the retailer announced on July 28.
“In partnering with Walmart, we are able to amplify our efforts to a larger audience and provide our guests with more free time, helping them prepare for their stays and enjoy the comforts of nature once they arrive,” said Carlos Becil, chief experience officer at Getaway.
Discounter Big Lots also plans to open 50 new stores this year, including one in Rogers at 210 S. Promenade Blvd. Like many of the recent Big Lots locations planned this year, the Rogers location, which opened in May, is a new format that features furniture and home furnishings, including patio and other outdoor items. The new format does not sell consumables, fashion or health and beauty aids like a traditional Big Lots format. The company has roughly 1,400 stores in 47 states.
Big Lots typically sells closeouts at a reduced price to traditional retail. The chain has struggled with inventory shortfalls amid the supply chain challenges of the past couple of years but said it will continue to invest in the new format and add 500 stores by 2030.
Editor’s note: The Supply Side section of Talk Business & Politics focuses on the companies, organizations, issues and individuals engaged in providing products and services to retailers. The Supply Side is managed by Talk Business & Politics and sponsored by Propak Logistics.