WAREHOUSING MULTICHANNEL
there is a growing divide between the qualities of space on offer. “Good loca- tions are the ones moving forward, whereas the others have become more and more challenged – there is a polari- sation of the market. “Some of the out-of-town landlords
have been doing phenomenally well. Those are the ones that have reinvented themselves. They have brought in fash- ion and department store retailers and kept evolving their offer.” And this is the crucial issue. It’s not just that retail- ers are favouring out-of-town for new stores; they are actively relocating.
The fashion for retail parks Latest Trevor Wood Associates research – which don’t take into account the full year for 2011 – show remarkable figures in terms of out-of-town activity over the past nine years (see box below). Fashion retailer Next – traditionally a
staple of the high street – has increased its out-of-town presence by a staggering 887% since 2002, and moved from 36th on the out-of-town ranking to sixth in just nine years. Next now has 2.89 million sq ft on
retail parks alone. Also revealing is the movement just in the last year. The list of top 20 out-of-town retailers by space from 2010 to midway through 2011 remains largely unchanged on the pre- vious year, apart from Pets at Home which has overtaken TK Maxx as the 10th largest retailer.
But in the top 20 listed there has
been significant movement, with Wickes, Marks & Spencer, Toys R Us, Dunelm, Harveys, JJB Sports and Moth- ercare World all climbing at least one place in the rankings. GVA associate head of shopping
centre management Janet Franklin believes the growing trend of click- and-collect is less of a reason for retail park owners to be concerned than an incentive for them to improve. She says: “There is change happen-
ing and I expect it to continue. I don’t think anyone’s expecting retail parks to disappear in the near future but the importance of the growth of online is something we’re very aware of. Any space retailers are opening needs to reflect the changing ways that shop- pers shop.” With more people using click-and-
collect, increasingly the retail park – with its easy access, free parking and larger units ideal for holding stock – will become the preferred choice for those shoppers, if it’s done right. Trevor Wood Associates founder
Trevor Wood says: “All types of retail- ers with click-and-collect need to be on a retail park. Multichannel means retailers need a larger unit for storage so they can guarantee having things in stock.” Nevertheless, many challenges
remain. The fact that Wickes is embark- ing on such a deep series of cuts to its
SHOP” Janet Franklin, GVA
“ANY SPACE RETAILERS ARE OPENING NEEDS TO REFLECT THE CHANGING WAYS THAT SHOPPERS
property portfolio is a sign that increas- ing sales via the internet invariably lessens a retailer’s need for physical space no matter how much they embrace multichannel.
Drastic measures As Wickes brand director Tony Hold- way points out, the bottom line is ever- present in a retailer’s property strategy, and with Wickes experiencing a 70% increase in online sales in 2010, a dras- tic decision had to be made: “As our online operations continue to flourish the need for large stores is reduced. Like most retailers, one of our biggest cost lines is rent. If we can cut down on rent without affecting our sales, it makes good business sense to do so.” Today the challenge for big national
chains like Wickes, other than lower- ing overheads by selectively reducing the portfolio, is working out how to turn the stores they do keep into the perfect space for a modern multichan- nel business to operate in. Rather than retail warehousing now being under threat, Wood believes quite the oppo- site: that if it’s done right it can be exactly the multichannel solution retailers are looking for. “Multichannel offers the customer
things you don’t get on the high street,” he says. “Having a bit of everything is the best way to do it, and out of town solves a lot of problems. If you get it right you have the best of both worlds.”
THE TOP 10 FASTEST GROWING OUT-OF-TOWN RETAILERS 2002 TO MID 2011 RETAILER Next Argos
Matalan Dunelm TK Maxx Dreams B&Q
Sports Direct
Marks & Spencer Boots
TOTAL AREA ON RETAIL PARKS (MILLION SQ FT) INCREASE SINCE 2002 (MILLION SQ FT)
2.89 2.71 3.77 1.55 2.05 1.32 7.51 1.26 1.65 1.84
* Increase measured since 2003 Source: Trevor Wood Associates for Retail Week
VIII Retail Week November 2011
www.retail-week.com
2.60 1.70 1.35 1.31 1.23
1.19 * 1.11 0.99
0.97* 0.97
2002 RANKING
36 20 9
45 26 – 1
40 –
24 MID-2011 RANKING
▲ 6 ▲ 8 ▲ 4
▲ 16 ▲ 11 ▲ 21 = 1
▲ 22 ▲ 14 ▲ 12
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