Grocery stores that are looking to enter a mall or are already located in one should consider creating a more developed selection of prepared foods. According to research, consumers who shop at the mall are more likely to purchase something already prepared for dinner, rather than buying food for a week to carry. One of the biggest advantages that grocery stores can obtain as occupants of major malls is comparatively low rent. In addition, malls can benefit from having an on-site grocery store.
A survey conducted last year by Valassis found that 17% of consumers say that they would be more likely to go to a mall if there were shopping options on site. This indicates that malls can get more benefits if they have an on-site grocery store than the retailer. In the 1960s, grocery stores were a fairly common find in shopping malls in the United States. Nick Egelanian, president of retail real estate consultancy SiteWorks, told Grocery Dive that food retailers tend to get a deal per square foot that's cheaper than the mall spaces they tend to prefer.
In an effort to court grocers, mall owners often propose the notion of a symbiotic relationship between stores and surrounding retail establishments. In some cases, large retailers, such as Walmart, that are too big to enter a mall, will bring the mall to shoppers. As vacancies continue and struggling operators close, incorporating the term dead malls into the modern lexicon, retailers could reuse mall space for store and online sourcing. Attracted by the prospect of high visibility, a destination location and generous incentives from owners, these so-called malls have been springing up across the country. Egelanian said that grocery stores should carefully weigh the costs and benefits of location A or B, including the price of rent, surrounding stores, access points and local demographics. If you want organic food, you have to go to a store, but if you also need to buy a pair of socks, you'll most likely have to stop somewhere else as well. For grocery stores looking for an advantageous location with low rent and high visibility, setting up shop in malls is an ideal solution.
Not only do grocers benefit from comparatively low rent and high visibility, but malls also benefit from having an on-site grocery store. With careful consideration of costs and benefits, grocers can make an informed decision about setting up shop in malls.
