Podcast

Boots on the Ground: Episode 5

Retail Trends

Summer Update 2024

Held in Las Vegas, NV
May 19-24, 2024

Evolving Retail Footprints

• Competitor Strategies: Starbucks faces increased competition from smaller footprint stores like Dunkin Donuts and Dutch Bros, which are out-positioning them by focusing on drive-thru and app-based ordering.
• McDonald’s Expansion: Despite being well-established, McDonald’s is hiring extensively for its real estate team, indicating a strategy similar to high-growth retailers.
• In-line Stores: Retailers like Scooter’s Coffee are now considering end-cap and in-line locations, reflecting the competitive nature of the market.

Backfilling Vacant Spaces

• Creative Solutions: Vacant spaces from bankrupt retailers like Bed Bath & Beyond are quickly being repurposed, often yielding better rents for landlords.
• The Read Report: Highlights innovative approaches to filling large vacancies, such as splitting spaces into smaller units, which are proving beneficial for landlords.
• Market Opportunities: Landlords view vacancies as opportunities to attract new tenants and improve rental income, benefiting from the current market dynamics.

Experiential Retail and Entertainment

• Family Activities: There is a strong demand for retail spaces offering experiences and activities for families, such as entertainment centers and bookstores.
• Reinvented Bookstores: Independent bookstores are seeing a resurgence, becoming social hubs and thriving in the market.
• Unique Retail Concepts: Retailers are incorporating entertainment elements to attract customers, with examples like Dave & Buster’s transforming arcades into casino-like environments.

Consumer Spending and Discount Retailers

• High-Income Shoppers at Dollar Stores: Dollar Tree’s largest growing customer base includes households earning over $100,000, indicating a trend towards discount shopping even among higher-income groups.
• Discount Retail Success: Dollar General and similar stores are seeing increased foot traffic, though spending per visit may be down, highlighting the value-seeking behavior of consumers.
• Economic Duality: There is a notable split in consumer behavior, with some spending on high-end products while others prioritize discounts, reflecting economic uncertainties and varied consumer priorities.