Best Buy, Staples & Office Depot Reduce Store Footprint
With online purchases on the rise, some retailers are reducing the size of their brick-and-mortar stores in an effort to lower costs. Best Buy, Staples and Office Depot are the latest retailers to unveil plans to reduce their store footprint.
Amid weak sales and growing online competition, Best Buy announced it plans to cut the size of its big-box stores from 45,000 square feet to 36,000 square feet.
"We can reduce our overall square footage while actually increasing our presence," said Brian Dunn, chief executive of Best Buy, at the company's annual shareholders meeting. "It's an opportunity to capture cost savings and get ourselves 'right size.'"
Best Buy will also sublease space to other merchants including grocers, beauty supply stores and home furnishing retailers. According to published reports, potential tenants include grocer Trader Joe's and cosmetics chain Sephora.
At a recent presentation, Staples also announced plans to reduce its store footprint. The office supply retailer said new stores will be between 15,500 square feet and 16,000 square feet, down from the current 18,000-square-foot prototype. The reduction comes as Staples has been closing struggling stores. Along with growing break rooms in the new stores, the downsizing is a means to lower costs and increase sales productivity.
Similarly, Office Depot unveiled its first new small store format in Springfield, IL. The prototype store is downsized from 27,000 square feet to 18,000 square feet. The smaller store's inventory includes best-selling products and brands, with an emphasis on print and copy services and technology. Office Depot also hired more full-time employees to assist customers in the small store prototype.