Winter 2017
Top 10 Industry Trends of 2017

9: Store within a store

Retailers will continue to find innovative ways of driving traffic and one of those methods is by nesting outside concepts within their walls. Take for example, the Sugarfina kiosk at Nordstrom’s in Toronto or the Publix grocery chain test-driving a Starbucks kiosk.

It’s a mutually symbiotic relationship in many ways. “On the independent/smaller scale retailer side, finding a synergistic retail partner can be a great traffic driver, open the brand up to a new pool of customers and can help offset the rent line item,” says Ani Collum, Partner, Consultant at Retail Concepts, a Boston-based retail consulting firm. “For big-box retail, it’s often a more formal leasing arrangement that they work out. Some of the benefits are the same as with small-scale retail but it also allows them to carry a brand without having to incur the inventory carrying cost,” Collum points out. “There is a lot of PR buzz that comes with these types of store-within-store dynamics at the big box level, which creates a lot of brand benefits for all involved.”

Proactive retailers will work a sub-leasing clause into their master lease, Collum says. How does this play out with the developer side of the equation? “In terms of managing this with their shopping center landlords, if the store-within-store dynamic is more temporary in nature, it can provide a lot of insights to the shopping center in terms of potential performance of a brand they want to engage in a long-term lease so it is a low risk way for them to see if a brand could be a longer term fit for them,” Collum says.

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Patricia Norins

Patricia Norins serves as VP of Specialty Retail & Publications at the International Council of Shopping Centers (ICSC). Considered the authority on specialty retail, she has been tracking the industry for the past thirty years. Norins is Publisher of Specialty Retail Report, the voice of the specialty retail industry (carts, kiosks and pop-up stores). SRR has a readership of more than 75,000 each quarter.

Poornima Apte

Poornima Apte is a Boston-area freelance writer and editor specializing in retail and the book publishing industry. Learn more at wordcumulus.wordpress.com.
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