Openings, Closings, & Other Key Industry Highlights

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January 26, 2022


Last week, Transformco (New Sears) permanently closed the Fort Lauderdale, FL Sears store and sold the underlying property to RK Centers, which is planning a mixed-use development for the site. Liquidation firm SB360, which is working with Transformco to close stores, updated the list of ongoing closures to include a Sears in Willow Grove, PA, outside of Philadelphia, which is the last full-line Sears department store in Pennsylvania. The list also includes two Kmart stores in Key West, FL and Hamilton, MT, though targeted closing dates were not provided. Transformco says it is looking to operate a diversified portfolio of a small number of larger, premier stores with a larger number of small-format stores. Click here to request a sample list of recent and future closings.

In this second white paper on the supply chain, we discuss the current state of the supply chain, how retail has responded, and the longer-term impact and outlook. Click here to request this report.


Amazon announced plans to open a clothing store, a roughly 30,000 square-foot location under the Amazon Style banner. The store, expected to open later this year in Glendale, CA, will feature women’s and men’s apparel, shoes and accessories from well-known and emerging brands, with prices catering to a range of shoppers. Unique to this venture will be the format and integrated shopping experience of the Amazon Shopping app. The Company plans to keep only one of each style on display while keeping the rest in the back room; shoppers will scan an item’s QR code to view colors, sizes and customer ratings. Fitting rooms will also be integrated with the app, allowing shoppers to have items sent to the fitting rooms with a single click. The store represents Amazon’s boldest move in the brick-and-mortar space since its 2017 acquisition of Whole Foods. Nonetheless, the Company’s true intentions to scale the concept remain unclear. Click here to request more info.


Academy Sports and Outdoors announced that it will open at least eight new stores in 2022 that will fill in certain existing markets in Florida, Georgia, Indiana, Kentucky and Texas, and expand Academy’s footprint into Virginia and West Virginia. With these openings, the Company’s existing store count will grow to 267 and expand its reach to 18 states. Academy is evaluating additional locations for stores that could also open in 2022.

The Company did not open any new stores during the pandemic. Prior to the pandemic, it had opened 8 – 10 stores annually; no expansion occurred during the pandemic to conserve capital. The current plan reflects a growth rate of 3%. We note that additional store opening costs could lead to higher SG&A margin during the ramp-up period, especially if sales at new units (or throughout the chain) lag expectations due to pressure on consumer spending, based on inflation and the expectation of higher interest rates. Another concern is pressure on cash flow due to additional inventory to stock the stores. Nonetheless, the balance sheet remained strong, and liquidity of $1.40 billion at the end of 3Q21 should be more than adequate to fund capital requirements. Click here to request a sample list of future openings.


Published reports claim that Tropical Smoothie Cafe is considering going public and may target a $1 billion valuation. The high target valuation would be driven, in part, by the Company’s strong same-store sales, which are up 29% compared to 2019. Tropical Smoothie opened 133 new stores in 2021, its largest single-year expansion, and signed the most franchise agreements in its history. Of the 332 new agreements, more than 70% were with existing franchisees, signaling operator confidence in the brand’s potential. Sources close to the deal said that private equity firm Levine Leichtman Capital Partners, which bought the Company in 2020, has been working on an IPO withMorgan Stanley and Jefferies Financial Group.

In this special analysis, our analyst team takes a look at industry trends to watch out for in 2022 along with predicted winners, losers, and question markets for each segment. Click here to request this report.


In line with its 2020 plan to shift the majority of its business to wholesale by FYE21, Save-A-Lot completed a deal in December to sell 33 stores in the Orlando area to independent grocery startup Ascend Grocery LLC. Based in Orlando, FL, Ascend is led by co-founder and CEO Chris Sherrell, former founder and CEO of Fresh Thyme Farmers Market, and co-founder and COO Dean Little, previously Fresh Thyme’s COO. The management team plans to improve and expand the fresh foods, produce, ethnic foods and meats offerings in the Orlando market as well as potentially expand to new markets. Beginning this year, the Company plans to remodel all stores to incorporate Save-A-Lot’s latest branding and format, including new décor, upgraded flooring and lighting, and updated produce and meat cases; meat traditionally represents about 25% of the chain’s sales. Based on the announcements to date, there may still be 50-100 corporate stores the Company aimed to transfer to potential licensees by FY21. Save-A Lot-operates about 110 stores in Florida, its second most populated state after Ohio (125 stores).


BJ’s Wholesale Club announced that it has entered into an agreement to acquire the assets and operations of four distribution centers (Rocky Hill, CT; Orlando, FL; Elkton, MD; Independence, KY) and the related private transportation fleet from Burris Logistics. The transaction, terms of which were not released, will allow BJ’s to insource its perishable supply chain. Burris Logistics has supported the daily supply chain operations for BJ’s perishable business for more than 20 years. The proposed acquisition includes the four DCs, the personnel at those facilities, the associated real property, and the necessary capital assets. This deal has been unanimously approved by the boards of both companies, is subject to regulatory approval and closing processes, and is expected to close in 2Q22.

In other news, BJ’s will open its newest location this Friday in Lansing, MI. The Company also opened a new club in Port Charlotte, FL on January 21; both sites have fuel stations. Including the two new units, BJ’s will operate 226 clubs.

Finally, BJ’s appointed Amanda Irish as SVP of own brands and innovation, a newly created position. Ms. Irish previously spent more than 22 years at Target, most recently as VP and merchandise manager (VPMM) for dry grocery and own-brand food. Click here to request a sample list of future openings.


Walmart/Walmex announced it is reviewing strategic alternatives for its operations in Honduras, El Salvador, and Nicaragua, while it will look to accelerate expansion in Costa Rica and Guatemala. Mexico, its largest market, remains a central focus. The Central America region represents about 17% of Walmex’s sales at MXN 89.9 billion YTD at the end of 3Q21 and includes 864 stores (25% of Walmex’s store base), the majority of which are under its Discount Store format (572). The Company indicated that while operations in the three Central American countries remain strong, it believes there are growth opportunities that could be better managed under a different structure, including a joint venture or strategic partnership. Over the last few years, Walmart has refocused its international strategy, selling off its U.K., Brazil, and Japanese operations, allowing it to focus its efforts in Canada, China and India.

In other Walmart news, the Company announced plans to open a one million square-foot fulfillment center in Olive Branch, MI this spring. The facility, located across the state line from Memphis, TN, marks the third new fulfillment center announced in the past month, with the other two in Lebanon, TN and Salt Lake City, UT. 

Last week, Walmart announced a string of executive changes. Micky Onvural, CEO of online retailer Bonobos, announced her immediate departure to become the chief marketing and communications officer for financial services firm TIAA. No replacement has been named. Carl Casey, Walmart USA’s e-commerce chief will be leaving at the end of February; Mr. Casey took over after Marc Lore, head of Jet, left the Company. Mr. Casey will be replaced by Tom Ward, who has led innovation efforts such as testing drones and turning stores into fulfillment hubs for online grocery orders. Scott McCall, a 30-year Walmart veteran who was chief merchandising officer for the U.S. announced his retirement. Charles Redfield, who has led the U.S. grocery business, will replace Mr. McCall. Finally, Walmart’s first chief customer officer, Janey Whiteside, announced she will leave the Company in March. The Company is searching for her successor.


According to reports, a group led by Acacia Research Corp., controlled by activist hedge fund Starboard Value LP, has offered to buy Kohl’s Corp for $64 per share, or roughly $9 billion in cash. Financing for the transaction would reportedly not be an issue. The bid represents a 37% premium to Kohl’s $46.84 closing share price on Friday. Meanwhile, private equity firm Sycamore is reportedly willing to pay at least $65 per share, implying a 39% premium to Friday’s close. Kohl’s confirmed that it has received two letters of interest but does not plan to further comment while it determines its best course of action. The Company’s share price closed yesterday at $63.71, up 36% from Friday’s close.

Last week, Macellum Advisors, which owns 5% of the Company's stock, issued an open letter to shareholders pushing for value-creation such as separating the Company's e-commerce and brick-and-mortar businesses. They also suggested management should monetize $4 billion of its real estate assets to fund a buy-back program. This morning, Macellum issued another letter, this time urging the Company to commit to a review of strategic alternatives, to form a committee of independent directors to oversee the review, and to invite a Macellum representative to join the board and lead the special committee.

In December, Engine Capital (which owns just 1% of the Company's stock) also pushed for separating its online business, which Engine Capital estimates could be worth approximately $12.40 billion, or to sell the entire Company, which it suggested could realize as much as $75 per share. On January 24, Engine Capital urged Kohl’s to aggressively pursue selling the Company and to consider creating a competitive sale process in order to maximize shareholder value.


Marco’s Pizza’s annual system-wide sales are projected to reach $1 billion in 2022. The brand, which currently has over 1,000 units and more than 200 stores in development, plans to grow to 1,500 units by 2023. Marco’s said it is investing millions of dollars in technology innovations through the next few years as the brand grows.


Hot dog franchise Wienerschnitzel inked an exclusive development agreement with Tejas Dogs, LLC to build 20 new restaurants in Arkansas over the next 12 years. This follows a 20-unit announcement in May 2020 with Lake Charles-based, Henderson Family Restaurants, LLC to develop the brand throughout Louisiana and to further expand throughout Southern and Midwestern states. Wienerschnitzel franchises more than 330 restaurants in 10 states.


In the latest example of a sporting goods manufacturer pivoting to a direct retail model, Wilson Sporting Goods Co. opened a new flagship store in New York City, a 6,500 square-foot unit in the SoHo neighborhood and the Company’s second permanent U.S. location. The first opened in July in Chicago, where Wilson is based. The new store features a 2,500 square-foot atrium “play” space, allowing visitors try out nearly any product in the store, and offers leather ball customization, glove personalization, and racquet stringing. The location’s product assortment spans all sports categories across Wilson’s portfolio and its women’s and men’s athletic-lifestyle sportswear collection. The Company is planning to continue to open new stores, including in Los Angeles as well as additional Chicago and New York units. Wilson has decades of experience in brick-and-mortar retail, having executed pop-up shops at sporting events like the Super Bowl, the College World Series and the US Open. The Company is a subsidiary of sports equipment, apparel and accessories manufacturer Amer Sports Corporation.

Our Hot Market Report takes a closer look at the Miami, FL real estate landscape, and provides visual competitive analyses as well as key real estate metrics such as future openings, store count, market share, digital insights, and demographics. Click here to request a copy of the full report.


Burton Snowboards is shifting to focus more on direct-to-consumer (DTC) sales. The Company has evolved to its current 75%/25% wholesale/DTC mix, and it has improved its omnichannel experience through enhanced customer service by employing customer data to support manufacturing, product development, wholesaling, fulfillment, e-commerce, physical retail, and marketing efforts. Based in Burlington, VT, Burton operates 66 stores and has thousands of partner retailers and wholesale dealers around the globe.


Reports indicate KKR is considering taking PetSmart public through a merger with a special purpose acquisition company (SPAC), in a deal valued at around $14 billion. This development follows PetSmart spinning off Chewy to the Company’s equity holders in February 2021 and speaks to the broader pet sector gains as the pandemic continues. PetSmart is privately held through a consortium of investors led by BC Partners; this same group took the Company private in 2015 in an $8.70 billion deal. 


At a virtual conference earlier this month, Casey’s General Stores CEO Darren Rebelez set forth three main goals for the Company in 2022: private brand and prepared food expansion, increased customer signups for its Casey’s Rewards digital loyalty program, and continued store count growth. Mr. Rebelez indicated that Casey’s, which operates more than 2,400 c-stores, will focus on organic growth and merger and acquisition activity for “both smaller and larger” players. He noted that the Company’s newest DC, which opened last April in Joplin, MO, can support another 1,000 stores. He said the Company has been able to offset rising cost pressures and wage pressures in the industry with improved fuel margins. In terms of private label, Mr. Rebelez revealed that the greatest areas of growth recently have been ice cream, chips and packaged bakery. He called the Company’s prepared foods “the jewels of the Casey’s business” and indicated breakfast traffic has seen a comeback after taking a significant hit at the height of the pandemic. In terms of its loyalty program, Casey’s is looking to “add more personalization of messaging for our loyalty customers,” which now number more than 4.2 million, exceeding expectations. According to Mr. Rebelez, rewards members visit 15% more and spend 6% more than non-members.


Conn’s anticipates generating annual revenue of $2 billion – $2.20 billion by FY25, up from current TTM revenue of $1.60 billion, representing growth of between 29% and 42%. In addition to increasing online revenue, management plans to expand the store base by 15% annually, up from a historical rate of 9% per year. New stores will average 20,000 square feet – 25,000 square feet, down from the current average of 40,000 square feet. Management implied that the expansion will occur in states which have realized the most recent population growth, including Florida, Texas, Arizona, and North Carolina. The ambitious plan is not without risk as the next three years will likely include rising inflation and higher interest rates, which may reduce the disposable income of its financially challenged customers.

The Company recently recovered from a period of overly aggressive expansion, which included relaxing its underwriting standards, and resulted in higher bad debt expense and deteriorating operations. We also note that the plan to increase online sales is likely to reduce gross margin, as online transactions are less profitable than revenue generated in store. Click here to request a sample list of future openings.


Los Angeles-based franchise operator Tasty Chick’n LLC completed the acquisition of 90 KFC units across eight states. Terms of the deal, including the identity of the seller, were not disclosed, but the total include 15 KFC/Taco Bell combination restaurants. Part of restaurant management company Tasty Restaurant Group, affiliated with private-equity firm Triton Pacific Capital Partners, Tasty Chick’n manages nearly 370 quick-service restaurants under the Pizza Hut, Burger King, Dunkin’, Baskin-Robbins, KFC and Taco Bell brands across 16 states. Click here to request a list of future openings.


Del Taco Restaurants opened its Fresh Flex prototype location in Orlando, FL last month. The opening is part of Del Taco’s “Menu of Venues” strategy, which looks to provide greater flexibility and scalability for franchisees. The Fresh Flex design is tech enabled and includes options such as a mobile app and third-party pick-up lockers, double drive-thru lanes with dedicated lanes for mobile orders and delivery providers, and designated parking lot areas for those who want to park and eat on the go. With nine new multi-unit franchise deals signed in 2021 for 68 new restaurants across 10 states, the Company will add restaurants across the country in Florida, Georgia, North Carolina, Virginia, California and Nevada. Del Taco currently has approximately 600 locations across 16 states.


High-end fashion retailer Escada America filed for Chapter 11 bankruptcy in Los Angeles, CA, citing rent payments, lingering ramifications of the COVID-19 pandemic and failed turnaround efforts. The Company, which operates 10 stores in the U.S., is planning to close five locations through the bankruptcy process, including outlets in Honolulu, HI; Las Vegas, NV; Cabazon, CA; Sunrise, FL; and Central Valley, NY. Escada America, part of the larger international Escada business, was established in 2009 after a previous bankruptcy by Escada USA. The Escada America division was purchased by Beverly Hills, CA-based PE firm Regent, L.P. in late 2019.


Michaels expanded same-day delivery of online orders to 100 stores across Canada, through an extension of its existing U.S. partnership with Instacart. Last March, Michaels began supplementing its own same-day delivery offering with Instacart’s service at nearly 100 stores across Chicago, Dallas, and Washington, D.C. Since then, the Company reports that it has seen a significant number of incremental customers shop via Instacart. 


Bojangles recently announced additional plans to grow throughout Texas. In June 2021, the brand expanded into Houston and Dallas Fort-Worth, with six franchised stores and 15 corporate locations. This month, the Company announced it has signed five multi-unit agreements and plans to build 30 corporate-owned stores, which will bring approximately 50 new restaurants to the greater Austin, DFW, Houston and San Antonio markets in the coming years.

The franchised locations in Texas will be dispersed throughout Austin, DFW, Houston and San Antonio, while the corporate-owned restaurants will operate in DFW and Houston. In addition to the development agreements already signed, Bojangles said there is potential to open more than 100 units in Texas over the next seven to ten years and is partnering with several franchisees to accelerate development in the state. Click here to request a sample list of future openings.



Last week, TGI Fridays announced Fridays on the Fly, a new small-format restaurant concept designed to meet consumer demand for delivery and takeout. At roughly 2,500 square feet, the new banner will also offer limited indoor dining. The first unit is under construction; CEO Ray Blanchette did not indicate where or when it would open. Each unit is estimated to bring in $2 million in average unit volumes, $300,000 in annualized EBITDA, with a $700,000 investment and payback period of 2.3 years. In October, TGI Fridays signed a deal with Reef to open up to 300 delivery restaurants in the U.S. and internationally during the subsequent five years. The Company has also launched several virtual restaurants, most recently partnering with food-tech platform C3 (Creating Culinary Communities). Mr. Blanchette commented, “For the past six months, we recorded sales volumes on a same-store basis that have exceeded pre-pandemic levels and have consistently beat the casual dining industry average…. Not only are we seeing existing guests visit more frequently and lapsed guests return, but an entirely new group of guests are joining the Fridays fan base.” TGI Fridays has approximately 700 restaurants worldwide.

Other chains that have launched new concepts to manage the growth of take-out as a result of the pandemic include PF Chang’s, which debuted P.F. Chang’s To Go in 2020, and Wendy’s, which has partnered with Reef to open 700 ghost or delivery kitchens across the U.S., Canada and the U.K. in the next five years. P.F. Chang’s opened its latest To Go location in Flower Mound, TX last week, accompanying two other locations in Texas, five in New York, three in Chicago and one in Florida. The Company has more than 10 To Go openings slated for this year and plans to expand the concept into more suburban areas. P.F. Chang’s operates more than 300 restaurants in 23 countries and U.S. airport locations.


Walgreens Boots Alliance and VillageMd will open eight primary care and pharmacy practices in the Tucson, AZ metro area in 2022, with the first opening on February 8. The new locations represent expansion into the second major market in Arizona, following Phoenix. VillageMD and Walgreens plan to open more than 200 Village Medical at Walgreens practices by the end of the year. To date, 81 locations already opened across 11 markets in Arizona, Florida, Texas, Kentucky and Indiana. In October, Walgreens announced it was investing $5.20 billion in VillageMD, increasing its ownership stake from 30% to 63%. The investment will accelerate the opening of more than 600 Village Medical at Walgreens primary care and pharmacy practices in more than 30 U.S. markets by 2025 and 1,000 by 2027.


In FY21, Giant Eagle’s revenues advanced about 3% to $10 billion, as grocery sales pulled back from peak pandemic levels, and fuel revenues increased as lock-downs eased and the retail price of fuel climbed. As of mid-January 2022, the Company operated about 480 stores (including about 210 supermarkets and 270 convenience stores) throughout western Pennsylvania, north-central Ohio, northern West Virginia, Maryland and Indiana. Giant Eagle’s limited efforts at store growth over the past few years have centered on its convenience store business rather than on its flagship traditional supermarket banner, which saw three closures in 2021. In September 2020, Giant Eagle, in partnership with Silicon Valley startup Grabango, opened its first cashier-less store at a GetGo convenience store in the Pittsburgh area.


M&M Food Market (Mississauga, Canada) announced on January 18 that it has entered into a definitive agreement to be acquired by Parkland Corporation, an international operator and consolidator of convenience retail and fuel marketing businesses. The deal follows rebranding and store transformation efforts by M&M Food Market, as the Company looks to expand both in Canada and internationally. The deal, expected to close during 1Q22, includes a national network of more than 300 M&M stores, over 2,000 M&M Express locations, and nearly 500 specialty frozen products. M&M noted that its brand, leadership, franchise system, store network, and office in Mississauga, Ontario will remain in place.


Alimentation Couche-Tard is franchising roughly a dozen convenience stores in Louisiana. The stores currently carry the Circle K banner but will change to franchised Kangaroo Express locations over the coming months. Couche-Tard acquired more than 1,500 Company-operated Kangaroo Express c-stores through its roughly $1.70 billion deal for The Pantry in 2015. The majority of those stores were converted to Circle K Company-operated sites and a select group of Kangaroo Express stores were made available for sale to become the foundation of the Kangaroo Express Franchise program. The latest additions to the franchise program were part of network optimization moves. 


Ahold Delhaize opened a new Food Lion store in the Mallard Creek neighborhood of Charlotte, NC. The store features hand-battered fried chicken, a self-service hot food bar, fresh cut fruits and vegetables, grab-and-go options; the location will also offer self-checkout lanes and the Food Lion To Go grocery pickup service.


Wegmans is hiring more than 600 workers for its new Washington, DC locations. The 81,300 square-foot Carlyle-Alexandria store will open in this spring, and the 84,000 square-foot Wisconsin Avenue store is set to open in the summer. The Company operates 106 stores in New York, Pennsylvania, New Jersey, Virginia, Maryland and Massachusetts. 


Smart & Final has partnered with Uber Technologies to expand grocery delivery to 173 of its stores in Arizona, California and Nevada via Uber and Uber Eats, with eventual plans to offer the service at all 254 of the Company’s locations. With the move, Smart & Final is also the first major U.S. grocery partner to offer alcohol delivery through Uber Eats; alcoholic beverages can be ordered for delivery in California and will be available in Arizona and Nevada later this year.