Colliers International Report Cites Retail Expansion, New Non-Traditional Outlet Centers
Holiday sales growth expected despite impact of Northeast storms
SEATTLE, Nov. 13, 2012 /PRNewswire-USNewswire/ -- As retailers gear up for the holiday season and hope to end the year on a high note, several trends and key indicators signal growth in North America, according to Colliers International's Q3 North American Retail Highlights Report, released today.
In the report, Colliers identifies a number of key retail issues, including:
- Hurricanes and Holidays: As if the stress of a potential pre-holiday strike from the International Longshoremen's Association wasn't enough, Hurricane Sandy hit the Northeast hard. Despite the impact, many retailers are expected to come in on or above growth targets, and those who integrate promotion across all distribution channels will be most successful. Both Citi and Shop.org release double-digit growth projections for online retail this year; Citi's forecast is the first-ever noted above the teens.
- Aggressive Price Matching: Target and Best Buy will be offering limited-time price matching programs for brick-and-mortar versus online ordering, as well as for competitor pricing online. This aggressive model represents the shift toward offering consumers low-cost, high-speed solutions for efficient holiday shopping.
- Speed(ier) Deliveries: This holiday season, select "test" markets will have the opportunity to experience same-day delivery from Walmart, eBay and the United States Postal Service. Depending on the initial results, these tests could bring major changes for fulfillment programs. Companies also might begin to trend away from unlimited "free shipping" programs as retailer gross margins diminish.
- Spending Strength: Although consumer confidence is low by historical standards, there continues to be signs of consumer strength as in the throngs who came out for the release of Apple's new iPhone 5 in September. This resulted in a year-over-year growth rate of 4.5 percent for electronics/appliance sales for the month.
- Outlet Centers: An increase in consumer confidence also means increased confidence for real estate investors. With the consolidation of department stores, a reduced cost of entry for retailers, and frugal shopping habits stemming from the recession, retailers and developers will continue to embrace the outlet concept and work to attract masses of consumers. More than 20 outlet centers are currently proposed for new development to begin in the U.S., and many are located in densely populated metro-areas, such as Washington, D.C., versus more remote locations or those adjacent to tourist destinations. Outlet centers are also attracting more high-end retailers.
- Canadian Consumers: In 2013, consumers in Canada will have a wider variety of shopping destinations. While many smaller chains are expanding and investing in stores to differentiate themselves, popular U.S. retailer Target will enter the Canadian market in the Spring. Target will join six of the 10 other largest U.S. retailers that have crossed the border, including Walmart, Home Depot and Best Buy.
- Trends to Watch: Eight of the nine key trends Colliers identified in early 2012 are playing out positively in the retail marketplace, including foreign investor interest in the U.S. and Mexico. There are currently 44 shopping center projects under construction in Mexico, categorized as both new developments and refurbishments.
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