Business Notes

New Store Openings Outpace Store Closings

In a Retail Gets Real podcast from the National Retail Federation (NRF), Anjee Solanki, U.S. national director of retail for Colliers, notes that there are more store openings today than store closings.

Colliers manages more than 2 billion square feet of retail establishments in the United States.

“Not only are new-store openings outpacing store closures, we’re seeing new formats — formats that are highly digitized, smaller in footprint,” Solanki says. “We’re starting to see rent collections bounce back. I’m still extremely bullish when it comes to retail, and I’m excited to say that as an organization here at Colliers, we’re also quite bullish.”

Solanki says nontraditional retail such as wellness centers and new pet-store concepts are changing the traditional retail space and inviting customers in. Meanwhile, experiential retailing concepts are maturing. Retail that sparks the five senses — touch, hearing, sight, taste and smell — creates a memorable moment and connection that Solanki describes as the sixth sense of a retail experience.

Department Store’s New “Spokes-character” is a Teacher

JCPenney, which turned 120 years old on April 14, is introducing a new spokes-character named Penny James, played by Saturday Night Live star Melissa Villaseñor. James is a mom, teacher and JCPenney superfan described as “the ultimate all-in shopping enthusiast who’s right at home in her ‘shoppy’ place.”

The company was founded in Wyoming by James Cash Penney

In a series of ads, James will share “all the reasons to love the JCPenney shopping experience, from modeling fabulous outfits, cozying up with home décor, relaxing with a hair treatment and style, and buying a pair of sassy, JCPenney-red prescription glasses.”

Her catchphrase is “Shopping is back!” which allows the company “to spotlight our standout portfolio of private brands, national brands and partnerships, the inclusivity at the heart of our company and product assortments and the work we’ve done as a business to evolve once again,” said VP of Marketing Bill Cunningham, in a statement.

Despite its past struggles, the retailer is now focused on providing “diverse, working American families” with “fashion, quality, convenience and value no matter where, when or how they want to shop.”

“The character of Penny James is a playful tribute to our customers and what they love about JCPenney,” said Carl Byrd, VP of creative and brand synergy. “We found a dream collaborator in Villaseñor who graciously helped us create an unforgettable and endearing representative of our brand.”

Other campaign elements include a brand refresh and a crosscountry tour with James described as a “block party-style celebration with local food vendors, games, music and giveaways” in 12 cities from May to August.

In a direct appeal from Board Chair Aaron Muderick on March 29, The Toy Association reached out to its members for assistance in determining the association’s strategy for dealing with ongoing supply chain issues.

“As an entrepreneur and business owner myself, I am all too familiar with the challenges many of you face,” wrote Muderick, the founder and owner of Crazy Aaron’s Thinking Putty. “I know from personal experience the struggles of a single-employee toy company, as well as those of larger organizations. I value the art of careful listening and want to hear many perspectives.”

Supply chain disruptions continue to plague world markets for a variety of reasons, said they letter. They include the following. • Ocean freight is creating a choke point in transport costs • Other shipping challenges continue to impact global markets over time • Costs of global raw materials continue to rise, partly as a result of the

US-China tariffs • Tensions caused by the Russia/China relationship • The impact of a destabilized Europe on selling markets and manufacturing options • Pandemic disruptions, including the Chinese government-imposed lockdowns that occurred when infection rates hit a two-year high earlier in March. The lockdowns impact major port cities, including the toy manufacturing hub of Shenzhen. • The high possibility of China’s issues impacting other Asian countries

“The Toy Association – from our staff to the board of directors and to our many volunteer committees – is tackling industry risk points related to shipping and supply chain disruptions, monitoring the latest developments, and planning for the future,” Muderick wrote.

He asked member businesses to contact him directly at crazyaaron@crazyaarons.com, with thoughts, opinions, concerns and suggestions to actively gauge the impact of the supply chain crisis. Specifically, he called upon them to think about the diversification of their manufacturing locations. “What are your needs?” asked Muderick. “Are there other global regions beyond Asia and India where the industry should focus for manufacturing potential? Rome wasn’t built in a day. How do we find secure places with the right infrastructure and potential to manufacture our goods?”

The association’s goal in collecting the information is to help member companies develop efficient, diversified supply chains and build resiliency over the coming five, 10, and even 20 years.

NRF Calls for Cyber Vigilance

In the wake of the financial sanctions imposed on Russia by the U.S. government and many other nations, concern about potential retaliatory cyberattacks by the Russian government and Russian-based cybercrime groups has increased. While they have not yet led to a wave of cyberattacks directed against the U.S. or its allied and partnered nations, there are good reasons to remain vigilant, says the National Retail Federation (NRF).

Not only has Russia carried out cyberattacks against Ukrainian infrastructure as part of the current conflict, Russian agencies have a long history of carrying out cyber intrusions against U.S. companies and government agencies. In some cases the goal was espionage, in others it was to prepare for future destructive cyberattacks.

On March 22, the Cybersecurity and Infrastructure Agency (CISA) held a lengthy call for private-sector stakeholders, reports the NRF. CISA reinforced guidance that it and other federal agencies have been providing to the private sector with respect to network defense, intrusion detection, incident response and business recovery; and discussed evolving intelligence indicating that the Russian government is exploring options to conduct potential cyberattacks against the United States.

CISA also urged companies to empower chief information security officers and “ensure that the entire organization understands that security investments are a top priority in the immediate term.” In addition, retailers must also be concerned about the potential disruptive impacts of cyberattacks on critical third parties, including IT and financial service partners and the utilities that provide electricity, water and telecommunications to their stores.

Retail cybersecurity leaders and industry partners will discuss these issues in many sessions and meetings at the upcoming NRF Protect in Cleveland, June 21-23. For more information on how to get engaged with NRF on cybersecurity, visit cybersecurity@nrf.com.

Is Five Below the Next Toys “R” Us?

Five Below sells most of its toys, games, room decorations and tech accessories for less than $5. It considers teens and tweens its key customers, and hopes to step into the void left by Toys “R” Us by targeting shoppers hunting for discounts, reports CNN Business. “We monitor trends in the ever-changing tween and teen markets and are able to quickly identify and respond,” the company said in filings. “Our price points enable tweens and teens to shop independently, often using their own money.”

Five Below has roughly 1,200 locations currently, and said it will open 1,000 more stores in the next three years. It sees an opportunity to add another 2,500 new stores by 2030.

The chain’s growth push reflects the larger boom of discount stores, a sector that has been more immune to the rise of online shopping and other challenges that plague brick-and-mortar retailers. Last year, for example, three dollar-store chains accounted for almost half of all the new stores opened in the United States.

Five Below’s locations are relatively small with low shelves, colorful signs, pop music playing on speakers, and wheelbarrows and oil drums full of merchandise. Its tagline is “Let Go & Have Fun.” Sporting goods, games, toys, tech gadgets, books, electronic accessories and arts and crafts make up about half of Five Below’s approximately $3 billion in annual sales, says CNN. T-shirts, beauty offerings and home goods account for around 30 percent, while party and seasonal goods, greeting cards, candy and snacks make up the rest. The store has recently moved into new product areas, including esports, and partnered with Instacart to offer home delivery.