Is There A Brick & Mortar Route To Retail Success?

With Thanksgiving around the corner, the retail industry’s prospects are squarely in focus. Retail is possibly the most visible face of consumer spending, which has powered the recent spurt in U.S. economic growth. But over the last few years, the industry’s landscape has undergone several radical changes. The most important of these is possibly the tussle between brick and mortar formats and exclusive online stores.

Around this time last year, it seemed that e-commerce was easily winning the battle. This is likely the case even now, with several retail majors expanding their online presence significantly. However, some brick and mortar chains are resisting the temptation to go online and have found new ways to fight the retail battle.

Battling a Retail Collapse

Nearly 16 million individuals are employed by the U.S. retail sector, making it a significant cog in the country’s economic engine. However, several of them have been forced to shutter several stores after failing to fend off online competition. And troubles don’t end there for this category. Several big names have even had to file for bankruptcy this year.

To provide a small illustration, in 2017 alone, Sears Holdings Corporation has shuttered more than 350 Sears and K-mart stores. Meanwhile, The Gap, Inc. (GPS – Free Report) and J. C. Penney Company, Inc. (JCP – Free Report) have shut down 200 and 140 stores, respectively.

But it isn’t that sales have completely fallen away for these traditional retail mainstays. Instead, several retailers with an online presence are witnessing a migration from brick and mortar outlets to their company websites.

Online, Offline or a Mix of Both?

This migration toward online portals has forced retailers to come up with methods to balance their online and offline presence. For instance, Target Corporation (TGT – Free Report) is following a two-pronged strategy of increasing its online presence and slashing prices. Meanwhile, nearly half of its online purchases are either being shipped from stores or being picked up from brick and mortar outlets by customers.