Since the start of 2017, more than 3,200 store closures have been announced, and many are from some of the biggest names in the retail industry. Department store giants Macy’s M, JCPenney JCP, and Sears are all shuttering store locations, while mall staples like The Limited and Bebe have closed down their entire brick-and-mortar fleet to focus on online sales.
This is just the tip of the iceberg, as retailers, especially those that sell apparel, have been hit hard by years of declining sales and customer traffic due to the rise in online shopping and, of course, Amazon (AMZN - Free Report) . The e-commerce giant has certainly transformed the way consumers think about shopping, and this new mentality has affected business operations at many retailers, especially those based in malls.
There are, however, some corners of the retail industry that Amazon still can’t seem to dominate, helping companies operating in these parts expand their store count instead of shrink it.
According to IHL Consulting Group, a retail consulting firm, discount retailer Dollar General (DG - Free Report) has plans to open as many as 1,000 new stores this year, with its fellow dollar discount peer Dollar Tree (DLTR - Free Report) planning on opening about 650 stores in 2017.
U.S. shoppers began shifting towards discount stores during the recession, with most never going back to shopping full price after the economy recovered. Other discount retailers like Ross Stores ROST, TJX Cos. TJX, which owns TJ Maxx and HomeGoods, and Burlington Stores BURL have directly benefitted, and are all opening stores in the double digits this year.
German discount grocers Aldi and Lidl are expanding as well. While Aldi has operated in the U.S. for some time now, Lidl plans to open its first 100 stores this year up and down the East Coast. Both grocers offer customers a no-frills grocery shopping experience. Think the opposition of Whole Foods WFM, in aesthetic and in how much your total bill is.
Even traditional grocers are growing this year. Kroger KR is planning on opening 55 new locations, while Walmart (WMT - Free Report) and Sprouts Farmers Market (SFM - Free Report) have plans for 59 and 32 new stores, respectively. Other big box rivals like Target (TGT - Free Report) and Costco (COST - Free Report) are expanding as well, according to IHL.
Beauty giant Ulta ULTA, one of the bright spots in the retail industry, is going to open 100 stores in 2017, with two huge locations opening on Chicago’s Michigan Avenue and in New York City’s Upper East Side. Ulta’s main rival, Sephora, which is owned by luxury conglomerate Louis Vuitton Moët Hennessy, is also opening as many as 70 new stores this year.
The beauty industry thrives, in large part, because of its reliance on brick-and-mortar. There’s a specific level of trust with beauty products that you need to experience face-to-face, if you will. And, if you have ever been in to an Ulta or Sephora, the first thing you likely note is either how busy it is in the store, or how long the line is. Both companies also generate a ton of online business and have great rewards programs, a combination that keeps the shadow of Amazon from creeping in too closely.
Other retailers expanding this year include automaker parts companies O’Reilly Automotive (ORLY - Free Report) and Autozone (AZO - Free Report) , Tractor Supply , Hobby Lobby, Aerie, the lingerie division of American Eagle Outfitters (AEO - Free Report) , Dick’s Sporting Goods DKS, Nordstrom (JWN - Free Report) , and Bonobos, which is reportedly being acquired by Walmart.
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