It seems that the
traditional brick and mortar retailer is under siege. If you do not have a
significant “omni-channel” presence or are not part of “webrooming” with your
customer’s tablets or cell phones, then you cannot compete or worse yet, may be
doomed to fail. Yet, simple facts contradict this conclusion. Simply put, the
lead factor for retail success—location, location, location—remains alive and
We all hear about how the
growth of e-commerce continues to explode and will over time, significantly
erode business at the brick and mortar stores. This has been the rumor for many
years. Yet today, 94 percent of retail sales are still rung up in the stores,
which is why having the right location is the difference between success and
Look at the growth of
retail over the past two decades. In 2013, almost three million retail
locations existed to satisfy the consumer’s appetite. This growth has occurred
in the face of multiple recessions and the closing of national chains such as
Circuit City, Border’s, Linens N Things, Blockbuster and CompUSA, to name a
few. Retailers rang up $369 billion in sales in 2013—almost double from 20
years ago. The collateral benefits from this kind of growth are dramatic to our
economy, including job creation, increased construction spending, and
manufacturing of goods sold.
Why such brick-and-mortar
growth in the face of our technology boom? Because at the end of the day,
customers still want that in-store experience. We want to be entertained,
informed, and to have fun. We want to touch and feel the product we are looking
to buy and, above all else, we want the instant gratification of walking out
with our treasured purchase.
transparency through webrooming, and e-commerce sales are all complimentary to
the art and science of retail. However, have no doubt that our brick and mortar
stores will continue to lead the way.
Alan P. Shor
Retail Connection LP in 2004. He serves as president and co-chairman and
heads up the firm’s investment and merchant banking business. Contact him at firstname.lastname@example.org.