Target opens pop-up dollhouse in Grand Central Station
New York — Target isn’t letting any grass grow under its feet when it comes to the suddenly hot category of home goods and home furnishings. The discounter has installed a giant, two-story dollhouse — some 21 ft. high and occupying some 1,500 sq. ft. of space — smack in the middle of Vanderbuilt Hall in New York City’s Grand Central Station. The temporary installation is designed to promote Target’s new Threshold brand and is completely furnished and accessorized with furniture, decor, and housewares from the collection. It even includes an outdoor area, complete with patio tables, lounging tables and green turf.
The house carries about two dozen products shoppers can purchase by using their smartphones to scan a QR code. The retailer will later ship the product.
Workers built the temporary installation, which is made up of interlocking panels, in Queens and then moved the structure to Grand Central. The installation opened on Monday and will close at the end of day Tuesday.
Target’s latest pop-up comes weeks before J.C. Penney Co. is set to make a splash of its own, with the opening of its multiple branded in-store home shops.
Chico’s names new board member
FORT MYERS, Fla. — Chico’s FAS, a women’s specialty retailer of private-branded apparel, intimates and accessories, has appointed McDonald’s executive Janice L. Fields to its board of directors.
Her appointment brings the total number of board seats to nine. Fields was also appointed to the board’s corporate governance and nominating committee.
Fields was president of McDonald’s from January 2010 through November 2012. Previously, she held numerous roles at McDonald’s, having started her career as a crew member. Prior to serving as president, she held several executive positions within McDonald’s USA, including U.S. division president for the central division from 2003 through 2006 and EVP and COO from 2006 through January 2010.
She currently serves on the board of directors of Monsanto Company and on the boards of the Field Museum and the Global Board of Ronald McDonald House Charities. Fields also chairs the board of United Cerebral Palsy.
"We are delighted to welcome Jan to our board of directors. Jan has deep experience with innovation and strategic insights in a world-class company. Jan’s perspectives on growing a large retail organization while maintaining brand-right messaging and personal service will be highly valuable as we chart our path for future growth," said Chico’s chairman of the board Ross E. Roeder.
Chico’s operates the Chico’s, Boston Proper, White House | Black Market and Soma Intimates brands, which operates 611 boutiques and 102 outlets throughout the United States. It also operates an e-commerce site and distributes a catalog.
Wrap-up coverage of Chain Store Age’s 49th annual SPECS
Store Development and Facilities
Store development and facilities professionals from some of the nation’s biggest retail and restaurant chains gathered in Dallas to attend Chain Store Age’s 49th annual SPECS Conference, at the Hilton Anatole Hotel. The event attracted professionals involved in the design, planning, and construction of stores and restaurants, along with those in facilities management.
The show combined a premier educational program — featuring more than 30 individual workshop sessions — and dynamic keynote presentations with plenty of business networking opportunities and a lively exhibit floor.
The educational program included workshops in seven targeted tracks: Facilities, Planning & Design, Food-service, Ground-Up Construction/Remodeling, Tenant Improvement Construction/Remodeling, Business Strategies, and — new this year — Real Estate Development.
Also new this year, SPECS partnered with a charitable foundation, the Retail Orphan Initiative (RetailROI), which brings together retailers, consultants and suppliers to help orphaned children around the globe. Founder Greg Buzek discussed how SPECS attendees can get involved and help the group in its efforts.
NETWORKING: SPECS is designed to facilitate business partnering and networking, and this year’s show was no exception.
In addition to coming together on the show floor and during workshop sessions, attendees gathered at breaks and meals. Many retailers also participated in the fourth annual SPECS Face-to-Face Information Exchange, which provided an ideal opportunity for retailers to lay out their business needs with suppliers in a direct and time-efficient manner.
The 50th Annual SPECS Conference will be held March 16-19, 2014, at the Gay lord Texan, in Grapevine, Texas. Updates will be posted on specsshow.com.
Take Center Stage
Solution Center Snapshots
The newest products and services from suppliers in store development, construction and facilities management were showcased in the SPECS 2013/Solution Center.
The exhibit floor offered the retailers, architects and other specifiers at the show a wide range of solutions, from flooring and signage options to painting contractors and maintenance providers to HVAC equipment and electrical services.
Lighting up sales:
LED lighting designed specifically for retail
It’s easy to take good lighting for granted. We tend to notice bad lighting, however, the very second we’re exposed to it, standing out as it does like a flashing neon sign with a couple of letters missing.
In retail, quality lighting is crucial — for the ambiance of the shopping experience, for the clarity of product displays, for employee morale and for the bottom line. Dim or harsh lighting can scare off customers; wasteful lighting can be a CFO’s worst nightmare.
Enter LEDs, long hailed as the savior of commercial lighting. But early LEDs drew criticism from consumers and businesses as being designed for energy efficiency over aesthetics, function over form. A true lighting solution for retail, combining valuable cost-saving opportunities and quality lighting performance, had yet to be achieved.
In 2002, LED innovator Tony Moore set out to solve this problem and create a niche for LED products specifically intended for retail merchandise illumination. “The need was clear,” Moore said, “that nobody had made a solution for T-8 bulb retrofit to LED in show-cases and store fixtures.”
Evolving the products through several generations, his company, LEDingEDGE Lighting, Inc., now boasts a full line of LED solutions for retail, designed for total performance: saving energy, reducing maintenance costs, giving long life to retail fixtures and delivering the long-sought-after “perfect light.” And whereas the majority of LEDs are manufactured overseas, LEDingEDGE uses primarily American-made components and materials, and the products are 100% assembled in the United States.
LEDingEDGE LED luminaries are offered in 1.7-in. incremental sizing, with three brightness levels — general purpose, super bright and ultra bright — and three color temperatures — warm white, neutral white and cool white. The flexibility enables manufacturers and retailers to use the precise size and light output required for any application, and the low-power usage means a higher lumen output that burns less energy.
Additionally, the company can adapt its standard line of LED products to create dynamic luminaires to suit custom architectural and merchandising designs, including embedded fixtures where the LED isn’t visible to shoppers.
Another of the company’s core advantages lies in the superior color of its products, enabled through a binning protocol called HyperDUV. Traditionally, LED makers use a 16-bin variant within a color designation, which assumes a fairly wide margin of error. With HyperDUV, LEDingEDGE is able to narrow the color variances down to a 4-bin standard and a significantly higher Color Rendering Index (CRI) light output level.
To learn more about the LEDingEDGE competitive advantage for retailers, visit www.LEDingEDGE.com,where you can spec your projects with color matrix matching systems and use the ROI calculator to determine the precise return on your investment.
Best of SPECS
Oldcastle BuiidingEnvelope took the top spot in the 20th annual Best of SPECS awards. The Terrell, Texas-based company provides products specified to close the building envelope, including custom-engineered curtain walls and window walls, architectural windows, storefront systems, doors and skylights.
Rounding out the awards were Groom Construction Co., Salem, Mass., a general contracting and construction management firm; and Atlas Sign Industries, Riviera Beach, Fla., a national full-service sign company.
The companies honored in the Best of SPECS awards were chosen by the retail attendees at the show. The judging criteria were based on booth presentation, salesmanship, product/service knowledge and overall support of SPECS.
Spotlight On: Energy Efficiency
By Marianne Wilson
Think your company has done all it can with regard to energy conservation? Well, think again. Significant opportunities for energy efficiency still exist in the retail sector, with a 29% savings on average, Maria Vargas, directorof the U.S. Department of Energy’s Better Buildings Challenge, told attendees at the SPECS session, “Introduction to the Better Buildings Challenge.”
“Despite the many cost-effective opportunities, however, persistent barriers still exist,” Vargas said.
These barriers include lack of senior management buyin, lack of a skilled work force, lack of information (with a need for unbiased information) and an “I’ve already done it” mentality. Another big barrier: not integrating energy efficiency into business planning.
There are also some roadblocks specific to the retail sector, Vargas noted, including a tendency to over-light based on outdated assumptions of what is necessary to make a property and shopping experience attractive.
“Also, in retail, customer comfort and the shopping experience take precedence over energy performance,” she said.
To help overcome the barriers to greater energy efficiency and drive action, the U.S. Department of Energy has launched a program, called the “Better Buildings Challenge.”
“Better Buildings promotes energy efficiency as a top-priority energy resource,” Vargas explained.
The Better Buildings Challenge, which is part of the larger Better Buildings Initiative, is a voluntary leadership initiative that asks public, private and nonprofit organizations to make a public commitment to energy efficiency. With a goal of making America’s commercial buildings at least 20% more efficient by 2020, the program supports commercial and industrial building owners by providing technical assistance and proven solutions to energy efficiency. It also provides a forum for matching “partners” and “allies” to enhance collaboration and problem solving in energy efficiency.
“So far, more than 110 public, private and nonprofit organizations, including 23 commercial businesses, have committed to the Better Buildings Challenge,” Vargas said, “including such retail partners as Best Buy, Kohl’s, Macy’s, Walgreens, Starbucks, Staples and Supervalu.”
To become a partner in the Challenge, the company signs a voluntary partnership agreement with the Department of Energy.
“The main things we ask a partner to do is to set a 20% energy reduction goal by 2020 across its portfolio,” Vargas explained, “and to kick off a showcase project within nine months.”
Challenge partners also commit to sharing energy consumption data to measure progress against their pledge goal, and sharing information about the energy-efficiency implementation models (including the tools, technologies and processes) they are using to reach their pledge goal.
“An implementation model is a replicable process or solution that an organization has used to achieve its energy-reduction goals,” Vargas said. “It may be an organizational/business decision or process, financing or implementation strategy that has addressed a barrier within the organization and/or within the market.”
At Kohl’s, for example, despite a track record of successful projects, the energy team was having trouble getting and defending sustained corporate funding for under-budgeted energy-efficiency projects. To overcome this barrier, the retailer strengthened the relationship between the finance and energy teams by embedding members of the finance department into the energy team. This succeeded in expediting the communication of financial benefits and the approval of energy-efficiency projects.
“The result or outcome has been an annual ‘new technology’ budget to test emerging technologies and a financial analyst liaison to expedite expense requests,” Vargas said.
The budget allows Kohl’s to pilot two to three new programs for 10 to 20 stores annually.
For its part, the Department of Energy agrees to lend technical assistance and assist with the development of implementation models, and provide national and local recognition, among other things to Better Building Challenge partners. (For more details, go to betterbuildings.energy.gov/challenge).
- Retail companies spend nearly $20 billion annually on energy.
- A 10% decrease in energy costs have an equivalent impact on operating income as a 1.26% increase in sales for the average retail store.
- Retail buildings account for more than 15% of commercial floor space, and consume more than 18% of all energy used by commercial buildings.
Spotlight On: Sustainability
By Katherine Boccaccio
Green leasing is surprisingly revolutionary. Despite the retail clamor for sustainable building and policies, leases rarely incorporate environmental standards into the legal language.
In the SPECS session, “Collaborating for Sustainability,” the Retail Industry Leaders Association (RILA) presented its case on the importance of building in leasing clauses that promote environmental efforts. Adam Siegel, VP sustainability and retail operations for RILA, was joined by a pair of retailers — Maria Barr, manager of global sourcing operations for The Disney Store, and Bob Jensen, director of construction for Family Dollar — to discuss where the industry is in terms of sustainable leases, and how they are working to help the movement gain traction.
“There is a disconnect between the landlord and the tenant,” RILA’s Siegel said. “Tenants want to install energy-saving devices and increase recycling rates, but most of the time those programs are not regulated by the lease.”
That’s not to say that landlords aren’t on board. In fact, that is where the greatest disconnect is, said the panel. The right hand (retailer) is unaware of what the left hand (landlord) is doing. And vice versa. The answer lies in green leasing.
According to Siegel, there are five reasons for a green lease:
- Improve base building efficiency;
- Align incentives for waste/energy reduction;
- Improve tenant space;
- Increase utility usage transparency; and
- Clarify access and control of key spaces.
Disney has been a leader in the green leasing charge.
“At Disney, we knew we had to collaborate with our landlords, as well as our merchant teams and production/sourcing teams for all sides of the environmental equation,” Barr explained.
The company created a pilot project in several shopping center stores to test feasibility of increased recycling. It’s in the very early stages, but it’s about turning challenges into opportunities, Barr told the audience.
Bob Jensen, who wears the sustainability hat for Family Dollar, has set a goal to develop a thoughtful green lease that contains negotiable and non-negotiable items that are designed to impact a building’s environmental and energy goals.
“We have to keep asking, ‘What if?’ in order to move this initiative forward,” Jensen said.
Spotlight On: HVAC
By Marianne Wilson
A three-year HVAC national replacement program that increased operational efficiencies, lowered overall expenses and maximized the customer experience was reviewed in depth at the SPECS workshop session, “National HVAC Replacement Program.”
The session speaker, L.J. Mohan, VP, facilities management and energy engineering, Ralph Lauren Corp., highlighted the data used to obtain capital funding for the replacement program against competing projects in the company, and the methods used to justify and prioritize HVAC system replacements.
In making the case for such a program, Mohan made it clear that facilities management can’t go it alone.
“The CFO and COO are two very important partners for retail facilities management,” Mohan said. “We need them and we must align ourselves with their priorities.”
In the case study example, the retailer started with a pilot program in stores whose HVAC units’ EER ratings were very low, which made the end result very attractive. When the pilot was done, and the CFO saw the dollars resulting from the energy savings, the decision was made to implement the program across the chain.
In addition to energy savings, the company benefits from not having to worry about the fall-out from equipment breakdowns and not being compliant with regulations.
“It gives the CFO budget certainty,” Mohan added. Mohan explained that before senior management makes a commitment to expend capital monies, there needs to be an understanding of how the investment will benefit the company.
Mohan explained that before senior management makes a commitment to expend capital monies, there needs to be an understanding of how the investment will benefit the company.
“It’s not enough merely to show it as a ‘good idea.’ You have to demonstrate that real savings can be achieved,” he said.
HVAC replacement is currently a top-of-mind concern for many retailers. Mohan explained why: “Capital rationing in the retail industry between 2008 and 2013 has resulted in a very old and aging fleet of HVAC units.”
As a result, retailers find themselves burdened with emergency repair costs, store downtime, costly “immediate” replacements, units with non-ozone friendly refrigerants and increasing energy costs due to old, low-efficiency equipment. With the phaseout of CFC and HCFC refrigerants, R-22 has nearly quadrupled in price over the past year, Mohan advised.
Regulatory agencies and concerns about the environment are also putting increased pressure on retailers.
“Approximately 40% of the energy consumption in a small retail store is attributed to its HVAC system,” Mohan said.
Retailers’ solution to the scenario outlined above: a strategic or optimized HVAC strategy that includes a national replacement program. This allows chains to benefit from energy-efficient systems that produce more heating or air conditioning for every unit of energy consumption, dramatically reducing a company’s carbon footprint while reducing its energy costs.
The first step in developing the strategy should be a detailed condition assessment of all HVAC equipment. The assessment should include location, age, run time, serial numbers, repair and maintenance costs, and SEER ratings.
“Gathering this information is a very laborious task,” Mohan warned. “You need a partner, either a manufacturer or service provider, to help you do it. But the repercussions of not doing it are very significant.”
Retailers should also consider optimal timing in repair versus replacement. “The need for major repairs starts at eight years of use,” Mohan said. “That is the time when the ‘known risk’ period shifts to a period of uncertainty.”
Mohan reviewed HVAC spend with regard to preventive maintenance (PM) versus repair spend. In companies with PM programs rated best in class, the repair spend as a percentage of PM was 250%. But repair spend as a percentage of PM spend jumped to 753% in retailers with poor PM programs.
HVAC optimization is good for store operations in that it helps to maximize the customer experience.
“It increases reliability and allows store personnel to focus on the customer, and provides for a pleasant shopping experience,” Mohan said.
It also provides significant financial benefits in that it reduces energy and maintenance costs, minimizes complaints and unplanned capital expenditures.
“These energy savings translate into real dollars,” Mohan said. “It’s positive cash flow with attractive net present value.”
Spotlight On: Color Trends
By Katherine Boccaccio
“The expectation of today’s consumer has risen — and that includes color and the way it is used,” said Leatrice Eiseman, color specialist, author, and consultant to Pantone, in the SPECS session entitled “Color My World — Color Trends.”
No color has higher expectations for 2013 than green, according to Eiseman. In fact, emerald (specifically Pantone 17-5641) has made a comeback, officially named Pantone’s 2013 Color of the Year.
“Green symbolizes sustainability and health, but it also is a fashion color,” she said.
The green hues can also be considered neutrals, supplanting tans, taupes and beiges as a retail backdrop. Deeper greens, such as olive and brighter shades like aqua and turquoise, can be strategically used to draw attention.
Other current color trends identified by Eiseman include:
- Oranges and yellows have made a surprise appearance as accent colors, employed on laminates, outdoor furnishings and as accent shades in darkened areas;
- Among the metallics, pewter has gained hold;
- Wood tones and finishes are being mixed and matched across settings that range from elegant to rustic, gaining popularity from the attraction toward sustainability; and
- Laminates layered with color are go-to materials for 2013.
Eiseman, considered a crystal-baller when it comes to color, offered the following forecast for the coming year:
- Look for neon pink instead of red.
- Neutrals will be accented with splashes of color like rosedust.
- Rugged color palettes suggest sustainability and will continue to garner favor. Tortoise shell, toasted coconut and chocolate brown will be accented by pops of color, such as orange, to add interest.
- Traditional blues and greens, always reliable, can be accented by a brighter blue or even pink to draw attention.
- Convivial hues — those that lie across from each other on the color wheel — will be used together to create interest.
- Neons will be around for at least another two years.
“The current economic climate is keeping colors around longer,” Eiseman said. “We are more reticent about change. That said, we will tend to experiment more with bolder colors as accents.”
Spotlight On: Retail Orphan Initiative
By Marianne Wilson
There are more than 400 million vulnerable and orphaned children worldwide, and the Retail Orphan Initiative (RetailROI) wants to help as many as it can. The charitable foundation brings together retailers, vendors and industry consultants to raise awareness and provide real solutions for these needy children, both here at home and around the world.
In support of RetailROI, SPECS invited the group’s founder and donor trustee, Greg Buzek, president of IHL Group, to make a presentation at the show.
“The opportunity for the store design/planning, construction and facilities colleagues from SPECS is absolutely crucial to the things that we are doing,” Buzek said.
There are many ways retailers and suppliers can get involved with RetailROI, both personally and/or on behalf of their business, including participating in a RetailROI “vision trip.”(For more, go to Retailroi.org/how-to-get-involved/get-involved.)
RetailROI has helped to build four schools in underdeveloped countries. While the tech side of retail has been very involved in these efforts, Buzek is now hoping to get the store development side equally involved.
“The talents of the design, planning and construction side of things would bring so much to these opportunities,” he said. “Even in projects where the walls are already up, there are issues with how to make the best use of the space, sound absorption and the like. We have a school in Liberia that has 215 children in nine classrooms that are made entirely out of cement. The sound simply bounces off the walls. It’s important to understand that what a person does every day as part of their daily job can be a critical skill that can brighten the life of a child in need.”
In support of the charity, SPECS donated two paintings that were done on site by famous speed painter Dan Dunn to RetailROI, which raffled them off during the show. The winners of the raffle, which raised a total of $5,880, were Todd Chapell, building estimator, Wegmans Foods Markets, Rochester, N.Y.; and Craig Chinn, associate principal, KTGY Group, Irvine, Calif.
Spotlight On: ADA
By Marianne Wilson
Making stores accessible through compliance with current ADA laws makes good business sense for retailers, especially given the size of the community. That was one of the messages that Chris Taylor, CEO, ADA Compliance Consultants, Austin, Texas, brought to the SPECS session, “ADA Options Within Existing Facilities.”
“Over one in five Americans, approximately 54 million people, have some sort of a disability,” Taylor said. “By 2015, the number will increase to one in four Americans. And 38% of adults 65 and older have disabilities.”
Stores that are accessible do not go unnoticed by people with disabilities.
“It means everything to them,” Taylor said, “and those are the stores that they will spend their money.”
Taylor reviewed how ADA laws are impacting retail stores and where a retailer’s responsibility begins and ends. He advised attendees to always check existing lease agreements and new lease renewals.
“A tenant is typically responsible for all interior space layout and accessibility involving their type of business,” Taylor said. “Building and property owners are typically accountable for all common area external accessible elements and interior permanent items.”
Taylor detailed the most common accessibility issues within existing facilities. These include but are not limited to: floor mats and throw rugs not secured or recessed; congested path of travel in crucial areas reduced below 36-in. wide; accessible sales counter blocked by product, not open, or set above 34 in. and POS set above 48 in.
“Floor mats are important,” Taylor said. “Use double-sided stick tape on runners to keep them in place.”
EXTERIOR: Common exterior barriers that create issues include pedestrian/curb ramps with excessive surface slope and improper landings, and lack of, or non-compliant, “off site” path of travel from the public sidewalk to the main accessible entrances to the store. Also, providing an improper ratio of, and non-compliant, disabled parking.
“Striping and signage issues are very common,” Taylor said.
Under the ADA, businesses that serve the public are to remove barriers when it is “readily achievable” to do so; in other words, when barrier removal is “easily accomplishable and able to be carried out without much difficulty or expense.
“This varies from facility to facility and year to year,” Taylor said.
He advised retailers to look at their sites to see how many things they could do for themselves — and to look at their budgets.
He also offered these suggestions to retailers for creating and managing an ADA compliance plan:
- Evaluate your facility for compliance with state and federal requirements;
- Identify all barriers and create a “Readily Achievable” list;
- Obtain multiple bids to structure an “Access Budget;”
- If not all work can be completed at once, create a phased plan that is realistic — and stick with it; and
- Obtain post-construction inspections and certification sign-off.
Spotlight On: Real Estate
By Katherine Boccaccio
A solid mixed-use development can be a boon to retailers who understand how to leverage the various components. According to Harry Koehler, VP site planning and traffic for Macy’s, and Emerick Corsi, president of retail for Forest City Enterprises, the right landlord-tenant partnership can help maximize mixed-use success.
In the SPECS session, “Mixing it up: Making Mixed-Use Developments Work for You,” the pair focused on Ballston Common Mall, the Forest City-owned urban mixed-use center located in the heart of Arlington, Va., anchored by Macy’s and undergoing a major redevelopment.
“The urban repositioning plan calls for food-court changes to free up about 15,000 sq. ft. for a grocer, altering the existing mall footprint to square off the space, adding a basketball court on the second level, constructing a residential tower and adding six levels of office space atop Macy’s,” said Corsi. That kind of redevelopment requires not only a solid public-private partnership, but also key tenant buy-in.
“When we are working on projects in existing developments — which is very common now — we have to carefully review the site, the buildings, the traffic, the parking and today, more than ever, the construction phasing,” said Macy’s Koehler. “The Macy’s shopper and the store’s ongoing business cannot be negatively impacted when a project is under redevelopment construction.”
Despite the inherent challenges, mixed-use is attractive to Macy’s. “We like the synergy of all the uses,” he said. “But we also must make sure traffic flow is efficient and parking supply is adequate since the shopper’s experience on any site begins as she enters the site.”
Both Koehler and Corsi agreed that if the landlord and the tenants work together, most challenges can be overcome. “Parking is a perfect example,” said Koehler. “In a mixed-use development, we often need less total parking stalls per thousand sq. ft. for the development than in a retail-only development simply because parking is easily shared among the users, for example, as departing office workers free up parking stalls for shoppers arriving in the evening.”
Spotlight On: Real Estate
By Katherine Boccaccio
For Starbucks Coffee Co., the biggest impediment to finding a site within an urban core is squeezing in the drive-through. That was just one of the challenges presented by retail real estate experts in the SPECS session, “Smaller Stores, Bigger Markets: Advantages and Obstacles to Urban Growth.”
Moderated by Jeff Green, CEO of Phoenix-based Jeff Green Partners and author of chainstoreage.com‘s “Retail Rap” online column, the panel included Kim Williams, store development director/south central region for Starbucks; Valerie Richardson, VP real estate for The Container Store; and Lisa Burbey, real estate manager for Chipotle.
Starbucks has perhaps the most prolific urban presence of the group, but even the 13,000-unit chain faces hurdles when opening a downtown store.
“Sometimes you have to be really creative to do a drive-through in an urban setting,” said Williams.
In fact, Williams and Chipotle’s Burbey will work together to solve a Starbucks dilemma in downtown Houston, where — at Louisiana and McGowan Streets — a Starbucks customer must drive by co-tenant Chipotle and circle back around to access the coffee drive-through.
“Despite the drive-through challenges, they really are a necessity, particularly in the south central region that is so convenience-oriented,” said Williams.
CHIPOTLE: Chipotle faces many of the same obstacles.
“Urban development by its very nature is a high daytime populace base,” said Burbey. “This makes forecasting our volumes really challenging.”
Chipotle has learned flexibility when dealing with urban stores, including limiting operating hours in those areas where evening traffic is nil, and throwing out the typical retail formula when projections are just about impossible.
“At iconic Fisherman’s Wharf, we faced signage and brand recognition challenges when we opened our restaurant there two years ago,” said Burbey. Because the location was worth it, Chipotle “went way out of the box and used a much bigger sign [than is typical].
“We don’t have the brand recognition of Starbucks or McDonald’s, so we must reach our core customer,” Burbey said.
CONTAINER STORE: The Container Store’s Richardson agreed. The 58-store chain has a 25,000-sq.-ft. standard footprint and about 10,000 SKUs — and a growing urban presence that has set an example among retailers for both the downtown impacts it’s made and the lengths it goes to ensure success.
“To reach our core customers, we must understand the mind-set of the urban versus suburban shopper,” said Richardson, “and that can vary from market to market.”
In Manhattan, which the Coppell, Texas-based storage-products retailer entered in 2000, the company learned how restrictive urban spaces can be.
“Vertical isn’t what we want,” Richardson explained, “because it’s not conducive to how we sell or how we operate.”
Parking is an obvious issue, as are loading docks and a customer base that expects “fast-fast-fast and in-stock all the time,” she added.
Nevertheless, the right urban location can be well worth the logistical headaches and the added expense.
“Revenues will be very high [in urban stores], but your costs are going to be very high as well. We’ve learned a lot and are still learning from these high-profile urban stores,” Richardson said.
Other Container Store notable urban stores are on Sixth Avenue in the Chelsea section of Manhattan, and the Fourth and Market location in San Francisco.