Openings, Closings, & Other Key Industry Highlights

Retail News

Powered by

Premier Source For Location Data

December 7, 2022

 
 

Claire’s is opening 21 store-in-store locations in Macy’s to diversify its retail footprint. The stores began opening this month and Claire’s will share in the revenue generated by the sales of its products. The Company is installing its own branding and fixtures, running its own promotions, and sending its own employees to set up, stock, and restock the stores. Since emerging from bankruptcy, the mall-based Claire’s has closed stores in struggling malls and opened in lifestyle and strip shopping centers. The accessory retailer also has agreements with more than 30 other companies including Walmart and CVS. Claire’s IPO, filed in September 2021, is currently on hold due to the market’s recent volatility. The new partnership is expected to benefit Macy’s as the retailer’s strategy is to diversify its customer base, including attracting younger customers. Macy’s has a similar store-in-store partnership with Toys “R” Us, whereby Toys “R” Us rolled out stores-in-store in all Macy’s locations.

 
 

This week, Shake Shack is opening a location at the Prudential Center in Boston, MA. The 3,600 square-foot restaurant will be the Company’s 13th Massachusetts outlet. Last month, it was reported that Shake Shack plans to add up to 70 new stores in 2023. See our Retail Openings & Closings map below for future openings. Click here to request a sample list of future openings.

 
 
 

Last week, there was a Senate Subcommittee hearing where Kroger CEO Rodney McMullen and Albertsons CEO Vivek Sankaran testified. Here are some highlights:

On lower prices… Kroger and Albertsons expect merger synergies will allow them to invest $500 million in lower prices, along with $1 billion on wages and benefits and $1.30 billion for improving Albertsons stores. They don’t plan to lay off any frontline workers, although there will undoubtedly be a number of corporate and support staff redundancies, including in the c-suite.

On store divestitures… They will work with the FTC to divest stores to a viable competitor, and they have proposed forming a new company (SpinCo) to spinoff stores they need to divest to win regulatory approval. SpinCo could operate 100 to 375 stores, while the merger will allow for up to 650 store divestments. Our store overlap analysis shows there are about 1,300 Albertsons stores, more than half its footprint, within five miles of a Kroger store. As of September 10, 2022 (the end of Albertsons’ 2Q22), Albertsons operated 2,272 stores, and as of November 5, 2022 (the end of Kroger’s 3Q22), Kroger operated 2,720 supermarkets.

On competition… Michael Needler, CEO of Fresh Encounter, which operates about 100 grocery stores in Florida, Indiana, Kentucky, and Ohio, testified representing the National Grocers Association, noting he was “agnostic” on the merger. However, he also argued independent grocers need “guardrails” to preserve their position in the market, and that predatory pricing by large companies like Walmart, Kroger and Albertsons is a greater threat to competition.

Click here for more information.

 
 

Hibbett’s 3Q23 sales and operating income increased, however, its high concentration of apparel has started to take a toll on margins, as competition and promotional activity increase. Sales increased 14% to $433 million, reflecting a comparable sales increase of 9.9% and the opening of 40 new stores during the year. The Company targets areas of small population to avoid being in close proximity to larger competitors with greater pricing power. Comps increased 51.7% compared to the 13-week pre-pandemic period ended November 2, 2019 (3Q20). Brick-and-mortar comparable sales were up 7.9%, while e-commerce sales increased 22% year-over-year. Gross margin fell 200 bps to 34.3%, reflecting lower average product margin, which was partially offset by 130 bps improvement in SG&A margin. Operating income increased 2.4%, but operating margin fell 90 bps. Management did not provide information on free cash flow, but noted that inventory was $405 million as of October 29, 2022, a 56% increase compared to 3Q22. The Company was in a net debt position at the end of the quarter compared to a net cash position at the same time last year. Liquidity of $98 million was adequate to fund capital requirements as of October 29, 2022.

 
 

Publix opened a new concept store in Naples, FL. The 38,300 square-foot location draws inspiration from now defunct Lucky’s Market as well as Publix’s Greenwise Market stores by showcasing its new “Pours beverage bar”, offering patrons the ability to sip wine and beer as they shop in the store. The location also includes a pharmacy and liquor store. Last month, Publix Food Markets opened six new retail units, ranging from 46,000 – 54,000 square feet, in Lutz, Milton and Cutler Bay, FL, Scottsboro, AL, and two locations in Myrtle Beach, SC. Click here to request a sample list of future openings. 

 
 

Yum Brands’ CFO Chris Turner revealed in a recent investor conference that the Company is looking for another chain to buy. Turner said, “We’re always scanning categories. The Mediterranean-foods space is interesting.” Yum and its franchisees own and operate 53,000 restaurants in 155 countries under the brand names Taco Bell, Pizza Hut, KFC, and Habit Burger Grill. Habit was the most recent acquisition in March 2020 in a deal valued at $375 million. Reports have speculated on various options that may be a good fit for Yum to acquire, including several Mediterranean and “healthy” options. These include Cava (168 units and $168.2 million in annual sales), Zoe’s Kitchen (124 units and $206.8 million in sales), Tropical Smoothie Cafe (1,026 units with $950 million in sales), and fast-casual salad chain Sweetgreen (150 units with $210 million in sales), among others.

 
 

Victoria’s Secret reported net sales of $1.32 billion in 3Q22, a decrease of 8.5% year to year. This result was in line with previously communicated guidance of sales to be down high-single digits compared to 3Q21. Comparable sales decreased 11%. Company provided operating income was $42.6 million, which was above the high-end of previously communicated guidance of $10 million to $40 million, but down from $108 million in 3Q21. The decrease in operating income reflects incremental inflationary pressures. On March 2, 2022, the Company announced a $250 million share repurchase program. During YTD22, the Company spent $214 million to repurchase approximately 5.1 million shares and it expects to complete the program by the end of FY22. Also in YTD22, there were 11 store openings and seven store closures in the U.S., bringing the total Company-operated store count to 838 as of October 29, 2022. By region, there were 812 stores in the U.S., and 26 in Canada; an additional 70 stores were operated in China under a joint venture. The Company is forecasting FY22 sales to decrease 6% to 7% compared to FY21 sales of $6.79 billion. At this forecasted level of sales, adjusted operating income is expected to be in the range of $525 million to $575 million, or approximately 8% to 9% of sales. The Company expects the acquisition of Adore Me to close by the end of January 2023.

 
 

Cracker Barrel reported 1Q23 revenue increased 7% to $839.5 million, primarily due to menu prices increasing 7.8%. Comparable restaurants sales (78.9% of total revenue) increased 7.1%, and comp retail sales (21.1% of total revenue) were up 4.3%. EBITDA fell 28.2% to $51.6 million on commodity, wage, and other expense inflation in excess of pricing, higher retail cost of goods sold, and elevated maintenance expense. The Company updated its FY23 outlook, now expecting revenue growth of 6% – 8%, compared to 7% – 8% previously. Commodity inflation is projected to be 8% – 9% (8% previously anticipated), and wage inflation is projected to be 5% – 6% (5% previously expected). The Company continues to anticipate three to four new Cracker Barrel units and 15 to 20 new Maple Street Biscuit Company units will be added in FY23.

 
 

H&M has initiated its previously announced cost cutting plan to improve business efficiency given the negative impact from its exit from Russia in July 2022, and challenging macroeconomic factors. The plan primarily relates to administrative and overhead costs, including reducing its workforce by around 1,500 positions. Overall, these actions are expected to result in annual savings of around SEK 2 billion (approximately $187.5 million), which are anticipated to kick in during 2H23. The plan is also expected to result in a restructuring charge of over SEK 800 million in 4Q22. The Company’s full exit of operations in Russia will cost about SEK 2.10 billion, or US$193 million, and the full amount was included as a one-time cost in 3Q22. On the real estate front, in FY22, the Company plans to open 89 stores, primarily in growth markets, compared to 94 new stores expected previously, and close 254, compared to 272 expected previously. On Sunday, the Company also announced that it completed its SEK 3 billion share buyback program, which it approved on June 29, 2022.

Click here to request a sample list of future openings. 

 
 

In 3Q22, Five Below was up against a tough comparison to 3Q21, when sales and comps were up 26% and 14.8%, respectively. For 3Q22, sales grew 6.2%, however, comps continued their negative trend, down 2.7%; the Company did beat its 3Q guidance of a decline of 1% to 2% in sales, with comps anticipated to fall 7% to 9%. Five Below is seeing the direct results of customers pulling back on discretionary spending. The sales growth was generated from new stores while the gross margin decline was limited to 120 bps. Overall, EBITDA declined 33% and 440 bps on a margin basis. The balance sheet remains in solid position with nominal debt (finance leases) and a net cash position. Liquidity is more than adequate with cash and revolver availability of about $240 million. The Company opened 40 new stores during 3Q22 and 102 YTD, finishing the period with 1,292 locations. Five Below entered two new states, North and South Dakota, and completed its goal of renovating 250 stores to its new Five Beyond concept.

 
 

Scheels plans to open a 240,000 square-foot store in Tulsa, OK under the All Sports banner in Fall 2024. The store will stock more than one million pieces of inventory throughout 75 specialty shops, and will represent the largest selection of sporting goods, fashion, and footwear in Oklahoma. The store will be the Company’s 34th location, with 30 existing units and three others scheduled to open over the next two years. See our Retail Openings & Closings map below for the four future openings. 

Click here to request a sample list of future store openings.

 
 

Fat Brands opened its first tri-branded location in the Los Angeles neighborhood of Valley Village, containing a Fatburger, Buffalo’s Express, and Hot Dog on a Stick. The tri-branded location presents an opportunity to expand menu offerings and test the performance of brand combinations. Should the location perform well, the Company may expand further with similar locations. It first began opening co-branded Fatburger/Buffalo’s Express locations in 2013 and now has more than 100 such units globally. In addition, it has co-branded Great American Cookies and Marble Slab Creamers at 225 locations. The Company is reportedly considering co-branding Fatburger with Round Table Pizzas. In October, it opened its first co-branded Johnny Rockets/Hurricane Wings location. 

 
 

There are indications that privately held WinCo Foods performed well in FY22, though not to the level of some peers due to the lack of a broad online presence. Nonetheless, inflationary conditions have led consumers to seek value in their everyday grocery spending, which has provided tailwinds for warehouse stores like WinCo. The strong operating performance over the last few years has led WinCo to accelerate openings; it has opened three new locations in 2022 (through mid-November), with plans of opening another in Centralia, WA later this year. Due to intensifying competition in California, the Company continues to expand in smaller markets.  Click here to request a sample list of future openings.

 
 
 

Lands' End's 3Q22 results came in below management's expectations. 3Q22 sales fell 1.3% year-over-year, which the Company attributed to lower demand and shifts in consumer discretionary spending. Overall, global e-commerce sales decreased 4.6%, largely driven by the decline in international e-commerce sales. The Lands' End brick-and-mortar business (3% of 3Q22 sales) saw comps rise 13%. Meanwhile, Outfitters' revenue fell 6.2% due to the normalization of purchases in travel-related national accounts. Finally, third-party revenue rose nearly 60%, due to the expansion of its Kohl's partnership (500 plus locations), the launch of its QVC on-air partnership, and strength in its business through Amazon, Target, and Walmart e-commerce sites. As expected, pressures from increased shipping expenses, incremental promotional activity, and an unfavorable mix shift drove gross margin down 440 bps. As a result, EBITDA margin fell 340 bps to 4.5%. Due to poor performance, management lowered its FY22 guidance once again and now expects revenue to be between $1.54 billion and $1.56 billion, down from previous guidance of $1.60 billion and $1.64 billion. On the balance sheet, cash levels fell 24% year-over-year, to $28.8 million, while total debt rose 25% to $400 million; inventory was up 18% (driven by early receipts). At quarter end, the Company's term loan balance was $248 million, and its $275 million ABL had $103 million of availability. Management previously stated that it was exploring refinancing options for its term loan, however, no further details were provided. The Company ended 3Q22 with $132 million in liquidity, down from $150 million in 2Q22.

 
 

Build-A-Bear’s revenues increased 9.8% in 3Q22, with net retail sales growing 8.3% as retail traffic remained high and more than offset a decline in e-commerce demand. E-commerce sales decreased 29.4%, but remained strong compared to 3Q19, and commercial and international franchise revenues increased 47%, to $5.3 million for the quarter. Ultimately, Company-provided EBITDA rose 18%, to $12.9 million for the quarter. Looking ahead, the positive trends continued into 4Q22, and the Company raised its guidance for the year. As of October 29, 2022, the Company had 347 corporately-managed stores, with two net closures during the quarter, including seven net openings in North America and nine closures in Europe. Through the Company’s third-party retail model, there were 65 locations as of October 29, 2022, with relationships that include Carnival Cruise Lines, Great Wolf Lodge Resorts, Landry’s, and Beaches Family Resorts, reflecting four net openings during the YTD22 period. The Company’s international franchisees operated 66 locations as of October 29, 2022, reflecting seven closures since 3Q21. The Company expects to end FY22 with an increase in total store locations in North America inclusive of third-party locations, with plans to open 20 workshops. Separately, the Company continues to expect to end the year with a reduction in locations within Europe. Combined across geographies, the Company plans to have more total locations at the end FY22 compared to the end of FY21 inclusive of third-party locations. Click here to request a sample list of future openings.

 
 

Dine Brands agreed to acquire Fuzzy's Taco Shop from Experiential Brands LLC, a subsidiary of NRD Holding Company, for $80 million, including $10 million in expected tax benefits. Fuzzy's is a fast casual restaurant concept specializing in Mexican food with 138 locations across 18 states. The concept is currently 98% franchised and is expected to generate about $230 million in system-wide sales during FY22. Fuzzy's CEO, Paul Damico, will continue to lead the concept as it joins Dine Brands' two existing banners, Applebee's and IHOP.

 
 

McDonald’s is testing a new to-go format in Fort Worth, TX, which includes an order-ahead drive-thru lane, pickup shelves, self-order kiosks, and designated parking areas for delivery drivers and curbside pickup customers. The nearly 3,200 square-foot model is 26% smaller than the average McDonald’s. The move comes as the Company’s e-commerce sales have surpassed $2 billion, with a record mix of transactions coming through the mobile app during 3Q22. In addition, 3Q22 represented one of the highest delivery sales quarters for the Company, despite a return to dine-in business. Several other restaurant chains are also testing to-go formats, including Chili’s, which launched its first delivery, takeout-only restaurant. P.F. Chang’s, Panera, Starbucks, and Dunkin’ have also embraced similar models. Meanwhile, Burger King and Taco Bell have also started testing conveyor belts to deliver orders to cars at the drive-thru.

 
 

The Gap brand Athleta opened a 5,000 square-foot, multi-level location in the Soho neighborhood of Manhattan, which includes a community space that can be used to hold classes or other small-group forums. This new outlet marks the banner’s 35th store opening in North America this year. For 2023, Athleta plans to open approximately 30 stores and is targeting $2 billion-plus in sales. Click here to request a sample list of future openings.

 
 

Ulta Beauty’s 3Q22 sales rose 17% to $2.34 billion, while comps were up 14.5%, driven by increases in both transactions (up 10.7%) and average ticket (up 3.5%). During the quarter, higher inventory shrink was more than offset by the leveraging of fixed costs and strong growth in other revenue, and as a result, gross margin jumped 160 bps; the Company is lapping 3Q21 when shipping costs were exorbitant. At quarter end, Ulta's operating margin was up 130 bps, to 15.5%. In 3Q22, the Company opened 18 new stores, remodeled eight, and relocated one, ending the quarter with 1,343 locations at an average size of 10,500 square feet. For FY22, the Company plans to open 47 net new stores and remodel or relocate 33 (down from previous expectations of 50 and 35, respectively). In connection with its 3Q results, the Company raised its FY22 outlook, and now expects comps growth of 12.6% to 13.2%. As of October 29, 2022, Ulta's balance sheet remained debt-free, while liquidity consisted of $250 million in cash and full availability under its $1 billion revolver. Cash levels were down almost 59% compared to the prior-year period, as the Company repurchased $572 million in shares during YTD22 and invested in its store base.

 
 

Sheetz is planning to expand into Michigan, with a new location in the Detroit area due to open in 2025. Earlier this year, Sheetz announced it will. be pushing into western Ohio, adding 20 new convenience stores over the next five years. The Company’s first outpost in that region is expected to open in Dayton in 2024. The c-store retailer first entered Ohio with a store in the Columbus market in April 2021. See our Retail Openings & Closings map below for future openings. Click here to request a sample list of future openings.

 
 

Southeastern Grocers’ Winn-Dixie banner is opening a new store on December 14 outside Jacksonville, in St. Johns County, FL. It is the first outlet to be newly constructed in 10 years and will feature a 41,000 square-foot Winn-Dixie supermarket and a separate 2,000 square-foot liquor store. The Company also has plans for more future locations, announcing in March 2022 that it will open a Winn-Dixie at College Park in Jacksonville in 2023 and in April 2022, it broke ground on a new Winn-Dixie site at Apopka City Center in Central Florida, also scheduled to open in 2023.

 
 

Alimentation Couche-Tard’s Circle K banner is piloting a new last-mile delivery format at two Charlotte, NC locations. Partnering with Food Rocket, a delivery app launched in San Francisco in Spring 2021, the two Circle K convenience stores will complete online orders from on-location micro-fulfillment centers that are between 170 and 500 square feet. Food Rocket guarantees delivery within a timeframe specified in the app, or it will be free.

 
 

Kirkland’s reported 3Q22 net sales of $131 million, a decline of 8.8% from the prior-year quarter. Comparable same-store sales decreased 7%, including an 8.6% decline in e-commerce sales; we estimate YTD comps fell 10.2%. Gross margin fell to 25% from 34.7% last year due to increased promotional activity to drive sales and reduce inventory along with higher freight costs, as well as the deleverage of fixed cost components on the lower sales base. Adjusted EBITDA in 3Q22 was a loss of $1.7 million compared to income of $14.8 million in the prior year quarter. Comp trends improved in the latter part of October and into the early part of Q4 with November approximately flat but due to an easy comparison from last year when comps were down 9.5%. With sales trends slightly improving the Company is also seeing some potential tailwinds to margins as freight rates and shipping costs ease, setting up for much improved product margins for 2023; 4Q may not benefit much as current inventory still carries these elevated costs. The Company plans to close 10 stores that were not strong performers and were possibly 4-wall breakeven, at the end of this year upon lease expirations. As of October 29, 2022, the Company had $60 million of outstanding borrowings under its $75 million revolving credit facility, which matures December 2024. At quarter end, total liquidity was $26 million, including $15 million available under the revolver and $11 million in cash. Importantly, the Company repaid $30 million of its outstanding borrowings ($60 million at October 29, 2022) during November and expects to bring that down to $10 million or less by year end along with a continued reduction in inventory levels.

 
 

Miniso, the global value retailer, expanded its U.S. presence recently adding six new stores, four in Texas and two in Florida. The mass merchandiser specializes in selling small, designed goods, including toys, stuffed animals, electronics, snacks, and fashion and beauty products, for $10 or less. The China-based Company first entered the U.S. market in Pasadena, CA in 2017 and since then has opened more than 70 stores, primarily in California, as well as the East Coast, where it operates an 8,000 square-foot flagship store in New York City’s SoHo neighborhood.

 
 

The fast-casual restaurant concept Freddy's Frozen Custard & Steakburgers has signed a master franchise agreement with North 49 Frozen Custard and Steakburgers to bring the banner to nine Canadian provinces (excluding Quebec), marking the brand's entry into the country. The deal includes the development of at least 20 Freddy's restaurants. Founded in 2002 in Witchita, KS, Freddy’s operates more than 450 restaurants across 36 states nationwide. Since the start of the year, the Company has added 140 units to the pipeline in both new and existing markets and plans to continue well into 2023.

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

For more information on AggData contact Josh Suffin@ (800) 789-0123 x172