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According to a new report from the Food Marketing Institute (FMI), “the rate of supermarket store openings in the U.S. recorded 10-year lows last year due largely to the sluggish economy, but store closing rates also reached decade lows as more food retail companies focused on expanding services at existing stores.”

The study, Facts About Store Development 2002, was released at FMI’s annual Retail Store Development Conference.

Some details from the study:

• The typical store opened last year covering 46,750 square feet, up from 44,072 in 2000, but still considerably smaller than the high of 57,064 square feet recorded in 1998.

• New store openings — at 3.5 percent — reached a decade low, but still outpaced closings, which also recorded a 10-year low — 2.3 percent.

• The conventional supermarket was the most popular format for new stores in 2001. This was closely followed by limited assortment stores and superstores.

• The selling area for a typical new store increased proportionally with the increase in store size in 2001 — 33,500 square feet of the building was used as sales floor (vs. 29,678 square feet in 2000).

• Although major store remodeling rates have slowed in recent years, the percentage of companies participating in store remodeling has actually increased from 22 percent in 1997 to 38 percent in 2001.

• Over three-quarters of stores remodeled (77 percent) in 2001 were expansions — the highest percentage seen in the past decade. The median number of square feet added in 2000 was 10,000. The median size of a store in 2000 before its remodel was 31,500 square feet.

• Twenty-four percent of survey participants said they remodeled in anticipation of competition entering the market, and 24 percent said they remodeled to meet the needs of changing demographics in their trade areas.

• Supermarkets continue to address consumer demand for one-stop shopping by offering a wider variety of services and departments in one place. The most popular services/departments in new stores are greeting cards (87.0 percent), deli (85.7 percent), fresh seafood (83.1 percent), prepared foods for takeout (79.2 percent) and in-store bakery (75.3 percent). Other services/departments — wine sales (58.4), in-store banking (49.4), in-store pharmacy (42.9) and gasoline sales (16.9) — continue to grow rapidly.

• Gasoline service was available in 16.9 percent of new stores built in 2001, compared with none of the new stores in 2000. Although online grocery shopping models are less prevalent than what they used to be, 23.4 percent of new supermarkets are dedicating a pick-up area for online orders.

• After a decline in video sales in the past few years, video sell-through has begun to grow again, with close to four out of 10 new stores offering video and other multimedia sales. This category has seen a sales boost due in part to the boom of the DVD marketplace.

For more information about the report, go to
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