world and gaining ground in the use of
new technologies. Some have late adapters, but changes are happening at many
levels. RetailNext reported that foot traffic in November and December was down
6. 5 percent in 2013 compared to 2012, but
added that shoppers actually spent more
per purchase (ATV, average transactional
Growth for retail establishments is evident in the recovery in new construction.
Private Commercial Construction in
the three months to November was up
12. 5 percent although, granted, still recovering from the Great Recession. While
retail vacancy rates remain high and
rents are rising only incrementally, dollars are being spent in remodeling as well
as new construction. The private sector
is leading the way. Spending on Private
Mall Construction, Drug Stores, and
Shopping Centers in the three months
to November rose 53. 2 percent, 49. 5 per-
cent, and 31. 4 percent, respectively. Multi-
Retail construction spending is 27 percent
higher than the same period one year ago.
The pace is picking up. Banks are easing
lending restrictions, which will make it
easier in 2014 and 2015 for businesses to
expand. The largest retailers are planning
to build more but much smaller stores in
urban and rural areas.
BUT CHALLENGES REMAIN
That there is a slate of good news does not
minimize the many challenges for retailers
and the retail environments product and
service providers that serve them.
• Retailers face wiser, less impulsive
consumers, who are holding around $590
billion dollars in cash— more than two and
a half times what they have held historically. That number has not changed much
in four years.
• The labor participation rate in the U.S.
is the lowest since 1978, and the unemployed and underemployed number is over
SIX TIPS FOR
SUPPLIERS IN 2014
What should A.R.E. member companies
be doing as we progress through 2014?
1 Plan for increasing activity
and additional construction
2 Invest in research and development to improve what you do
3 Take risks—go where you have
never gone before.
4 Put extra effort into customer
retention, a less costly option
than continually searching for
5 Focus on top-tier clients. Know
their current needs and do the
harder detective work to know
where they are heading in the
next three years.
6 Expand into select overseas