The retail industry has suffered a string of retail collapses recently. Howard’s Storage World, Pumpkin Patch, Payless Shoes, Herringbone, and Rhodes & Beckett have all closed. According to the latest figures from the Australian Retail Index, which monitors foot traffic in more than 2500 retail stores country-wide, the number of shoppers entering and exiting stores has declined 4.4 per cent compared with 2016.
In an economy in which retail stores are struggling to stay profitable amidst plunging consumer spending, it can be tempting for retail stores to reduce their rents by moving to a cheaper location or moving to online sales only. However, online sales still only account for less than 15 per cent of total retail spending, according to ShopperTrak, the company that conducted the research for the ARI.
It makes much more sense to refurbish your retail space instead, not least because of the commercial and financial cost of relocating. Relocating can also be dangerous for a business’s reputation. Retail businesses that have remained in a particular area over many years build up a dedicated local clientele, as well as becoming “known” for where they are located. Moving away from a premium shopping strip, with a large amount of foot traffic, could lead to a reduction in the number of walk-ins to your store.
Easier access to products, more open spaces, and ease of movement, are all critical to attracting customers to your business. Engaging an experienced project building manager to refurbish your space can ensure that your store offers a more positive experience for customers. A refurbishment also ensures that you can maximise the cost of rent prices by reclaiming open space and being able to fit more inventory, thus reducing storage costs. Many back-office areas in the retail sector are cramped and uncomfortable. A refurbishment could release more open space for employees, improving morale and a more productive workforce.
Particularly in the retail sector where buildings are rarely demolished or rebuilt, there are limited opportunities to maximise and reclaim space. Working with an experienced building project manager will allow you to realise opportunities to make better use of space that may have been overlooked.
If you think that there are opportunities to make more efficient use of your physical space and reap the most benefit out of your retail rent, then contact a Programmed Property Services expert today.