Over eighty percent of new stores will go out of business within ten years.
Some will be DOA; others will have painful slow deaths. And some old stand-bys may also bite the dust. (Who’s next? I’d watch K-Mart. I think the merger of Sears and K-Mart was not a marriage made in heaven. Two plus two makes three.)
There are over nineteen-and-a-half square feet of retail space for every shopper in this country. Over-stored? Probably. But there will always be new ones springing up, and that’s good. Otherwise women and some men would die of boredom.
The obvious and time-tested reasons why stores fail are poor quality, too high prices, bad locations, and obsolescence. But here are six that are becoming more prevalent:
They Don’t Connect with the Cyber-generation. Twenty-ish folks are savvy and smart. They are in instant and constant communication with each other. They are technically adept and immersed on-line. They expect information to be delivered to them digitally, free and now. So they seek out stores that have individuality, immediacy and are interesting
They Sound Uncertain and Discordant Trumpets. They can’t decide what business they’re in. They add lines, and confusion.
They Aren’t Dancing With the One Who Brought Them. Starbucks is an experience and a meeting place. What is a Starbucks in a Target Store? Virtually empty.
They Have Mega Un-service. Customer loyalty is down to one bad experience, then out. Zero tolerance. Poor service is an epidemic.
They Are Near a Good Location. There are sites in my neighborhood that have witnessed four or five separate tenants. Why? Around the corner are thriving establishments. Due diligence would have been nice.
They Aren’t a Destination. Survivors draw crowds. Stores that are fun to visit have a chance to last. Could a store stand alone, or does it depend on other traffic? If not, a going out of-business sale will come soon.
So if you intend to start a new store, it must be cool, with it, exciting, understandable, easy to get to, and provide great service. Otherwise, try anything else.
George Lemmond
