Case Study 2
Adapting Store Size to the Type of Location
Submitted By : Marie Jo Aguzar
Under what conditions should a large box store retailer like a Best Buy Pursue a smallstore strategy?
As U.S. chain retailers absorb the lessons of the great recession, many bigbox chains have started to shrink average store footprints to reflect the growing importance of multichannel shopping, adapt to urban settings and recognize the need to optimize investment. I suspect you got this from research so it’s always good to put from where both a brief note here and then in a bibliography page.
WalMart Stores Inc., Target Corp., Best Buy Co. Inc. and Gap Inc., among others, all have small concepts in the works or are adapting existing ones. These smaller store formats should allow the retailers to maximize profitability and open more stores in closer proximity to each other. WalMart Stores and Target have been the most highprofile examples of this trend.
Small store are more convenient and the economics of running them are better. with downsizing, you can get a huge return on investment, mainly because of lower expense and lower investment in each store. any one paragraph should have 57 sentences
Part of the logic for expanding through smaller units has been logistics—it would be virtually impossible to find 200,000 contiguous square feet of retail space in the middle of Manhattan, so bigbox chains have no choice but to downsize to enter certain markets.
In the case of Best Buy or Apple Store, the strategy of stocking only a limited number of products in its physical stores has helped reduce its real estate costs and create synergy between physical store and online sales channel. Customers come to its physical locations to testdrive new gadgets, but they have the option to get items shipped to them directly without added cost. This helps drive business both instore and in the Internet. ...
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