The department store business model isn’t quite working in our current retail environment, so two of the country’s larger chains are thinking about taking on some roommates to help pay the bills. Both Kohl’s and Macy’s plan to do business in a smaller part of their existing stores if someone will rent them.
Reuters reports that Kohl’s CEO Kevin Mansell said during a conference call this week that the discount department store chain is looking for ways to get more traffic in its stores and make some extra income.
“We are looking for opportunities to bring in other retailers to take that square footage that we are able to carve out to drive some additional traffic,” he told analysts on the line.
Maybe the shoppers visiting the theoretical other stores would also stop by Kohl’s as long as they’re in the neighborhood, or at least in the same parking lot.
Mansell said that the chain plans to cut down on the the square footage that it operates as Kohl’s stores, but not necessarily close a huge number of stores.
Kohl’s outlined plans to try this with just under a third of its current locations. Imagine 500 virtual “for rent” signs, but what the company didn’t explain was what it’s looking for in a roommate.
Macy’s, meanwhile, knows exactly what kind of tenant it’s interested in. It’s more likely to create rental spaces in its urban stores in expensive areas, like its New York and San Francisco locations. These would go to “high-end” retailers, presumably so high-end that their wares aren’t already for sale at Macy’s.
by Laura Northrup via Consumerist