While the COVID-19 pandemic was ravaging retail businesses in 2020 and into 2021, many assumed that the increase of e-commerce would change the retail landscape, thus eliminating the need for storefronts and retail space. In the first two quarters of 2022, retailers have opened more than 4,200 stores, exceeding this year’s store closings by 240%. In fact, 2022 is on track to be the first year of net-positive store openings since 2016.
This is an indication that the American storefront is here to stay. And why? Because storefronts and retail spaces are more than just a place to shop.
1. Stores Drive Growth for New Brands:
In 2021, the growth rate for new retail businesses rose nearly 50% over the average growth rate from 2016-2021. This is mainly because of the 45% increase in e-commerce in the last two years alone. As great as online shopping may be, brands are beginning to realize that a physical storefront garners growth and awareness. Storefronts and retail space provide what a website can’t: customer experience. Also, you may be surprised to hear that brick-and-mortar stores reduce the cost of customer acquisition. Don’t believe us? Just ask brands like Warby Parker and Brilliant Earth.
2. Retail Space Completes the Brand Experience
The case for many retailers is that they’re not just selling a product – they’re selling a brand. A meaningful brand experience helps convert customers and drive sales – and a storefront location allows just that. Customers testing products in-person, buying online and picking up in-store, and diverse payments (cash, crypto, etc.) all aid in that crucial brand experience. Not to mention, brick-and-mortar storefronts provide immediate access to a product.
3. Storefronts Are Important for Communities
Retailers significantly contribute to communities. In 2019 and 2020, nearly 20,000 physical stores closed, creating financial tension for communities, as their tax revenue helped pay for schools, emergency services, and other valuable benefits.
Even national brands are narrowing in on product offerings to attract a local audience. Brands like Nike, Nordstrom, and IKEA are customizing their merchandise to attract a local audience. Even medical is getting hip to storefronts as we’ve seen the rise of “medtail,” where quite literally, retail meets healthcare.
Whether you’ve just begun a Craigslist search for retail opportunities, or you’ve been scouring CoStar for retail space for sale, our retail team is here to help you find the perfect storefront in your community. From Downtown Cleveland and beyond- we can find you your perfect storefront. Click here to contact us, or here to start your search.
To learn more about how CRESCO, Greater Cleveland’s leading commercial real estate company, can help you with your property needs, contact us at 216.520.1200, or fill out the form below. A CRESCO professional will contact you shortly.