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While we’re still in the midst of the Covid-19 pandemic, plenty of experts are saying that some of the habits we’ve developed — in-store and curbside pickup, home delivery, avoiding crowds — will stick around long after the crisis is over.
To reflect shoppers’ changing behaviors and needs, a number of popular store chains are changing up their store formats. Expect to see some teensy versions of the stores you love in the coming months and years.
Here are the brands that are shrinking:
Target has opened more than 100 small-format stores.
Over the past few years, Target has been introducing smaller stores that are between 12,000 and 40,000 square feet.
And they plan to keep building these and go even smaller — as in, a convenience store-sized 6,000 square feet — as they try to squeeze into college campuses, urban areas, and tourist destinations.
These smaller format stores offer Drive-Up, Pickup and Delivery services, so unless your heart’s set on browsing a full 130,000 square foot Target store, you’re getting the best from Target in a smaller package.
Kohl’s is scaling down storefronts to fit in smaller neighborhoods.
Kohl’s stores have always been about 80,000 square feet. That limits where they can open new stores. To be more flexible, Kohl’s will be rolling out 100 compact stores that will be less than half the size — around 35,000 square feet.
Kohl’s will begin opening these small-scale stores in Texas, West Virginia, Washington, and Massachusetts, starting in June 2022. Even though they’re smaller, these new miniature stores will include the new Sephora beauty section.
Macy’s & Bloomingdale’s are going small to escape the mall.
In January 2021 as Macy’s started closing 45 underperforming mall locations, Macy’s opened their second small-format store, called Market by Macy’s, which is 20,000 square feet — a tenth the size of a normal Macy’s mall store.
There’s a curated selection of Macy’s product offerings in the Market, but if they don’t have what you want, you can always order it from Macys.com and pick up in store.
Sister chain Bloomingdale’s is going to try out the format, too, with the first 22,000 square foot “Bloomie’s” coming to Virginia this fall.
Starbucks is prioritizing ‘pickup only’ for massive growth.
Starbucks is looking to grow from 33,000 locations to 55,000 by 2030, and a big part of that expansion will be smaller “pickup only” locations.
Since people are increasingly using pickup, drive-thru, and delivery at Starbucks, the coffee giant has been opening pickup-only stores at a rapid pace.
There’s no seating here; the mini-Starbucks is optimized for quick pickup via drive-thru or curbside.
Burger King’s new format will have no seating & 3 drive-thrus.
In 2021, Burger King will debut a new pickup-only restaurant in Miami, Latin America, and the Caribbean.
The new locations will have three drive-thru lanes, with one dedicated for delivery drivers picking up mobile orders. There will also be dedicated pickup parking spots. The entire ordering experience will be touchless, using the Burger King app or website.
There’s no timeline for this overhaul, but BK execs say they’ll slowly bring the format into remodels and new construction as opportunities arise.
IKEA is still freaking huge, but can at least fit into a shopping center.
The first-ever smaller format IKEA just opened in January 2021 in Queens, New York. At 120,000 square feet, it’s 62% smaller than the average IKEA and fits in a shopping center alongside Old Navy, Bed Bath & Beyond, and Marshalls.
Other than the size, it’s a normal IKEA (but with a nice flat fee to get your goods delivered).
IKEA is planning for more of these stores in the coming months and believes the smaller size will allow them to squeeze into densely populated urban areas.
‘Sam’s Club Now’ is 100,000 square feet smaller than regular clubs.
A 32,000 square foot “Sam’s Club Now” will debut in Texas this fall, a much, much smaller version of the average 134,000 square foot clubs.
There will be fewer products available for sale, but with an emphasis on grocery and fresh food items. And if there’s something you want that they don’t have, you can get it shipped to store for easy pickup.
Walgreens is testing smaller, pharmacy-only stores.
The bulk of Walgreens’ revenue comes from pharmacy sales, and as the chain looks to cut costs, boost revenue, and grow their territory, they’re developing 30-40 pharmacy-only stores.
Walgreens executives said 20 of the smaller Walgreens stores are now open, with 10-20 more under construction or otherwise in development.
These stores won’t have a grocery section, but instead will focus on pharmacy, over-the-counter healthcare products, and pickup options.
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Nike is opening up to 200 super-local ‘Nike Live’ stores.
Back in June 2020, Nike said they’re planning to open 150-200 “Nike Live” stores — a members-only, smaller format concept — over the next two to three years.
Nike Live stores are only accessible to members of the NikePlus loyalty program, and feature a two-week inventory rotation that reflects the buying patterns of the store’s community.
Nordstrom is seeing early success with ‘Nordstrom Local.’
Nordstrom started opening Nordstrom Local stores back in 2019, and although the pandemic has been brutal to their bottom line, the department store chain sees serious potential in the small hub format moving forward.
The 3,000-square-foot Nordstrom Local (compared to a typical 140,000 square foot mall store) is designed to be a convenient neighborhood hub where there’s no inventory. Instead, Nordstrom Live is a place to pick up orders, try on clothing purchased online, and take advantage of simple services like alterations, repairs, and gift wrap.
There are plenty of others who’ve dabbled in smaller formats.
- The smaller, grocery-based Walmart Neighborhood Market has been around for years, and there are no indications that Walmart is looking to expand the concept.
- Meijer opened their first smaller-format grocery store called Woodward Corner Market in early 2020, with plans to open six of these urban stores by 2021.
- Dollar General introduced smaller format stores back in 2017. At last count there were only 10 DGX stores, and the company hasn’t mentioned any plans to expand the concept.
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