The Rise and Fall-and Rise-of Brick-and-Mortar Retail

Remember all those predictions, not all that long ago, about the death of brick-and-mortar retail? Well, guess what, it’s back and, except for Covid, it never really left. It just held its breath and held on as best it could. Here are three sample articles to refresh your memory:

Is This the End Times for Brick-and-Mortar Retail?

PYMNTS.com, April 16, 2019

Nearly 3000 Stores Are Closing in 2021 as the Retail Apocalypse Drags On

Business Insider, March 17, 2021

What the Decline of Brick-and-Mortar Sales Means for Retail Marketing

Forbes, Aug 30, 2021

A pair of feature articles in the May 2023 issue of GlobeSt.’s Real Estate Forum magazine got me thinking… not only about the “brick-and-mortar vs. e-commerce” debate that seemed so important just a few years ago, but also about the value of predictions in general (but let’s not go there). And, of course, 3 years of Covid has placed an asterisk on all of this.

The two articles, which make for some interesting reading, are “Retail’s Bright Future Lies in Brick-and-Mortar After All” and “Can E-Commerce Regain Its Momentum?”

Let me digress and go out on a limb here: We’ve entered the Age of Hybrids, where different models not only can exist simultaneously but also complement one another. We have hybrid work models, a mix of WFH and going to the office. We have hybrid cars. And with the growth of so-called mixed marriages, we have more “hybrid” people than ever before in history. And, of course, we have hybrid retail models, where e-commerce and brick-and-mortar work together to boost a brand, increase customer engagement, and add to the top line.

Pendulums swing, trends shift, and consumers evolve, but what has all this got to do with franchising? A lot (but you knew that).

Here are some clues from those two articles:

“Brick-and-mortar, with its set rent and proven returns, has been helpful in driving not only customers to the store for sales, but to the website,” said Spencer Jordan, SVP of Leasing at The Easton Town Center in Columbus, Ohio.

“We all want free shipping, we want it quickly, but sometimes it’s worth driving 30 minutes to do it all at once,” said Stephanie Cegielski, VP of Research at the International Council of Shopping Centers.

“Now that the normalization to pre-pandemic trends has mostly played out, e-commerce will begin to gradually re-accelerate, but at slower growth rates than seen prior to the pandemic,” said James Bohnaker, Senior Economist with Cushman & Wakefield.

“E-commerce is just too expensive. The cost of customer acquisition and last-mile delivery is far more expensive than opening a store. Bricks and mortar is still the best way to acquire a customer,” said Mark Masiner, Chairman of Global Retail at Newmark.

Read the full articles here.