Discount retailers are expanding rapidly because consumers are more price-conscious and retailers are adapting with smaller formats and efficient operating models. For communities, this creates an opportunity: many discount and off-price brands are actively looking for new locations, especially in secondary markets where population growth and available space support expansion.
Table of contents
- Why value-focused retail is growing
- Which retailers are expanding right now
- Why do these brands open stores faster than others
- How retail closures create new opportunities
- What communities should do when a major retailer closes
- FAQs
- Sources, assumptions, and methods
Why value-focused retail is growing
One of the most consistent themes discussed in the Retail Strategies webinar: 2026 Retail Trends & Outlook is the shift toward value-oriented spending.
Retailers and economists often describe this behavior as “trading down.”
Consumers are still spending money, but they are more selective about where they spend it.
Examples of trading-down behavior include:
- Premium grocery → discount grocery
- Mid-tier apparel → off-price apparel
- Traditional pharmacies → value-focused general merchandise
This shift isn’t necessarily about declining consumer confidence. It’s often about budget prioritization.
Many households are choosing to:
- Spend more on experiences like dining or travel
- Save money on everyday goods
The result is a stronger demand for retailers known for value.
Which retailers are expanding right now
Retail industry data shows that several value-oriented retail categories continue to expand store counts.
According to industry coverage from the International Council of Shopping Centers (ICSC), categories seeing strong expansion include:
- Off-price apparel
- Discount retailers
- Beauty and wellness retailers
- Grocery concepts
These brands often thrive during economic uncertainty because they attract a broad range of shoppers. (icsc.com)
Examples frequently mentioned in expansion discussions include:
Discount retail
- Dollar General
- Dollar Tree
Off-price apparel
- TJ Maxx
- Burlington
- Ross
Discount grocery
- ALDI
- Grocery Outlet
These retailers typically open hundreds of locations nationwide each year.
For communities seeking new tenants, these brands are often among the most active site selectors in the market.
Why these brands open stores faster
Discount retailers succeed in part because their operating model makes expansion easier.
Several factors contribute to this.
Smaller store footprints
Many value retailers operate stores between 8,000 and 25,000 square feet, making it easier to fit into existing buildings.
This flexibility allows them to reuse second-generation space rather than waiting for new construction.
Lower construction costs
Their prototypes are typically simpler.
They require:
- Fewer build-out costs
- Minimal customization
- Faster opening timelines
High-frequency visits
Value retailers depend on frequent trips.
Consumers often visit:
- Weekly for groceries
- Frequently for household goods
- Regularly for apparel bargains
This consistency supports a stable sales performance.
How retail closures create opportunity
Retail closures often receive negative attention in the news, but in real estate markets, they frequently create opportunity.
When a retailer leaves a well-located property, the building usually has:
- Established parking
- Strong traffic counts
- Existing utility connections
- Zoning approvals already in place
Because of this, many second-generation spaces can be backfilled quickly.
In some cases, new tenants take over former retail space within six to twelve months, depending on the building condition and the local market.
This turnover cycle is common across retail real estate.
What communities should do when a major retailer closes
When a large retailer leaves a community, the reaction often focuses on the loss.
However, successful communities treat these moments as repositioning opportunities.
A structured recruitment approach typically includes several steps.
Step 1: Evaluate the real estate
Before recruiting a new tenant, communities must understand whether the space is actually market-ready.
Important questions include:
- Is the building structurally sound?
- Does it meet modern tenant size requirements?
- Are utilities and infrastructure adequate?
Historic buildings, in particular, may look attractive from the outside but require interior improvements.
Step 2: Understand your retail demand
Effective recruitment depends on strong market analysis.
Communities need to understand:
- Trade area demographics
- Spending patterns
- Retail leakage and surplus
- Psychographic characteristics of residents
This data helps determine which retailers are most likely to succeed locally.
Retail recruitment frameworks stress that communities should identify their trade area and analyze spending data before contacting retailers. retail-recruitment-checklist_Re…
Step 3: Target the right operators
Rather than focusing only on national chains, communities should also consider regional entrepreneurs and multi-unit operators.
Many successful local restaurants and retailers expand into nearby markets.
These businesses already have:
- Proven business models
- Operational experience
- Regional brand recognition
Recruiting from nearby markets can often be faster than recruiting a national chain entering a new region.
Step 4: Build relationships with site selectors
Retail deals often begin with conversations long before a site is selected.
Communities that regularly attend retail industry events and maintain relationships with:
- Brokers
- Site selectors
- Franchise operators
- Developers
are more likely to hear about expansion plans early.
Retail recruitment programs emphasize relationship-building with these industry stakeholders as a core step in attracting new tenants. retail-recruitment-checklist_Re…
Why secondary markets are gaining attention
Another factor driving retail expansion is the continued growth of secondary and tertiary markets.
Many communities outside major metropolitan areas are attracting attention because they offer:
- Population growth
- Available development sites
- Less competition for space
- Lower operating costs
Retailers increasingly see these communities as strong locations for new stores.
What this trend means for economic development leaders
For city managers, economic developers, and downtown leaders, the growth of value retail offers several lessons.
Communities that attract new retail typically share a few characteristics:
- Maintain accurate market data
- Identify development-ready sites
- Communicate clearly with brokers and retailers
- Present a credible story about their trade area
These elements make it easier for retailers to evaluate a location and move forward with a project.
FAQs
Why are dollar stores expanding so quickly?
Dollar stores expand quickly because they operate smaller stores, require lower construction costs, and serve price-conscious consumers.
Are discount retailers replacing traditional retail?
Not entirely. They are filling part of the demand created by changing consumer spending patterns and retail closures.
How can communities attract value-oriented retailers?
Communities should prepare accurate market data, identify suitable retail space, and maintain relationships with brokers and site selectors.
