EQUIPMENT & DESIGN
Store Design
Small Formats’ Big Future
Smaller, faster and more efficient are key design considerations shaping the food shopping experience of the future.
AN INDUSTRY E XPERT WEIGHS IN ON THE SIZE OF THINGS TO COME. By Steven Duffy
Key Takeaways ith the advent of a new year and decade, there’s no better time to address the topic of format as grocers continue to gravitate toward smaller store sizes, an accelerating trend. As the stage is set for what’s next, during 2020 we experienced increased preparation of meals at home, reaffirming grocers’ place in our lives. As we head into 2021, grocers will strive to intelligently implement planning from an omni-retailing stance, influencing the types of stores and how they’re networked. Here are considerations for how small formats are part of that future strategy.
Why and What Is Downsizing Format?
As a trend over the past decade, retail footprints have steadily decreased in size. The average grocery store size is currently 38,000 square feet, with small formats ranging in size between 12,000 square feet and 25,000 square feet, and even smaller in urban markets. Retail as a whole has focused on reducing footprints for a decade, chiefly to manage cost and profitability. The cost of capital to develop and deploy grocery real estate is nearly double that of conventional retail, based upon the fixtures, furnishings and equipment required to fit out a store. As work from home grows, it enables a move toward shopping closer to home. This shift in how we shop is an opportunity for grocers to
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In 2021, grocers will strive to intelligently implement planning from an omni-retailing stance, influencing the types of stores and how they’re networked. The significant adoption of e-commerce will holistically transform store formats in terms of convenience and a frictionless experience. Three critical factors for any format’s success in driving engagement are assortment, value and convenience.
re-evaluate their store portfolio, clustering network and formats, significantly leveraging new real estate opportunities. The labor needed to operate and serve customers is higher, and grocers and equipment vendor partners are continually seeking ways to deliver fresh or prepared foods with greater efficiency and high quality. Other factors driving smaller formats include more narrowly