5 Factors Influencing the Future of Retail Real Estate
The future of retail won’t be centred around a flagship store – and it won’t be all about e-commerce either. It will be a seamless integration of both, facilitated by new developments in transport and delivery. Welcome to the future: where we’ve torn down the bricks and mortar stores and built ones made of clicks and mortar in their place.
1. Integrating online with offline
Right now, shopping is a two pronged thing: you either browse and buy online, or you get in your car and hit the shops. But that’s about to change – and overseas it already has. Part of American brand J Crew’s success can be attributed to the fact that they offer their customers so many options. You can buy something online, pick it up in store, and return it while you’re there if it doesn’t fit – or you can buy in store, try it on at home and send it back by courier. This kind of integration involves having your distribution centre nearby – preferably in the same building. In the near future we’ll see retail stores adjacent to, or in the same block as, their distribution warehouses. And shopping centre models will adapt to encompass both, removing the disconnect between online and offline altogether.
2. Driverless vehicle deliveries
Some of the biggest factors influencing the future of retail aren’t where you’d expect them to be: in store. They’re on the road – or will be, very soon. Driverless, electric delivery vehicles will not only save you money on couriers and petrol, they will remove the need for designated parking as they can park themselves anywhere. Although mass integration will take decades, Google’s first fully autonomous cars are set to hit the market in 2017, so you can cash in on these particular advantages very soon. And, when everyone else stops getting behind the wheel, there will become less and less need for carparks, freeing up more prime retail space… perhaps for your shop-adjacent distribution centre.
3. Drone deliveries
We’ve come through the age of information and are now well into the time of impatience. Same day deliveries aren’t fast enough – or won’t be when companies such as Amazon start offering the 30-minute drone deliveries they’re currently testing. And they won’t all be leaving your shop by air. Dominos Australia recently rolled out delivery pizza drones – literally. As with driverless delivery vehicles, drone deliveries will cut down your need for parking. And, if you’re largely in the business of delivering – whether that be pizza or parcels – you’ll no longer need to be so centrally located once you’ve crossed your two largest transport costs, labour and petrol, off your spreadsheet.
4. The future of restaurants
Maybe you’re not keen on buying a drone to deliver your food. Maybe you can just let the customer sort their delivery for you. Uber Eats is taking big bites out of the global restaurant market – currently in Australia, it’s set to hit here next. Customers order their food and Uber to pick it up all in one transaction, paying one fee that includes both their food and delivery price. This means they can get anything from anywhere without leaving home – and, as a result, your restaurant can be based anywhere too. Eateries will no longer need to occupy prime real estate. Just an Insta page and a phone number and you’re good to go… to your customer’s house.
5. Print it, don’t display it
It’s not just the way you get things to and from your store that will have a huge impact on the future of retail real estate – with the expansion of 3D printing, you’ll no longer need to get things to your shop in the first place. Over time, 3D print shops will replace countless items that are currently sitting around on display waiting to be bought. When you’re able to print your products in store, you’ll no longer need such a big space – let alone the need for storage warehouses and distribution centres. This could be the biggest disruption to retail yet. But, if you start preparing now, you can make sure it’s a positive one.
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