Redesigning Retail
Posted on in Business News , Cycles News
A recent article published on Forbes explains why the traditional retail model is no longer sustainable and how big brands are seemingly "turning it on its head".
One of London's oldest department stores, Fenwick, sees it joining the retail space race as it announces plans for renting out around 10% of the department store's floor-space, meaning that around 3,500 square foot of the shop floor will be given over to office space.
Hugo Fenwick said about the new development:
"Although mitigated by significant investment in the brand's own multi-channel platform, it is recognised that Fenwick will need to extend the building to provide a further revenue stream that will cross-subsidise the contribution from the department store."
As well as Fenwick, Marks and Spencer and Debenhams are also reported to have similar plans. This news is unsurprising as retail sales continue to decrease and large units such as department stores are both hard to fill and expensive to run.
Forbes questions whether this reduction in space represents a last desperate throw of the dice for department stores or whether it's an imaginative way to breathe new life into underused and unprofitable space, while being able to maintain a physical presence.
Similar concepts include Starbucks' "third-space" where a coffee shop can double act as a work zone and even a place for business meetings.
The article concludes that while up-and-coming concepts with low overheads such as Netflix and Amazon may appear to be thriving, a physical shop has something that an online retailer cannot have and something that human beings will always crave- presence and physical interaction.
In adapting to appeal to this element of consumer wants and needs, offline retail may have a hope yet.