Small Will Be Big: Kantar Retail

ELLIOT ZWIEBACH

LOS ANGELES — Small stores will continue a big trend in retailing during the next few years, fueled by risks to capital and an increasing number of older consumers who prefer small to large, speakers said here Wednesday at the mid-year forum sponsored by Kantar Retail.

"Wal-Mart is already operating small stores on the international level, and it's able to move across borders with good ideas," David Marcotte, director of retail insights at Kantar, said. "If Wal-Mart decides to pursue that kind of growth in the U.S., it will have strong working models to learn from."

Marcotte also said Supervalu has already committed itself to expanding smaller-format stores. "It's already doubled down on Save-A-Lot, and other retailers will look at what it's doing and follow," he said.

As store sizes shrink, retailers will have to rely on improved comp sales rather than new square footage to achieve growth, John Rand, director of retail insights, said. Whereas square footage grew an average of 142 million square feet among Kantar's retail clients between 2005 and 2007, he said growth among those chains is likely to fall into approximately 72 million square feet over the next three years — a 51% reduction.