Real leadership isn't measured by what you accomplish during good times—it's revealed by how you act when everything falls apart. Business philosopher Dov Seidman claims that how we behave in business can become a source of competitive advantage. A recent example of this was the COVID-19 pandemic, which separated the leaders who adopted convenient rules and technically-allowed actions from those who were guided by deeply held core values and focused on long-term relationships and success.
Finding the Right Location For New Shopping Center Development
By: Kenton McKeehan and Mike Jordan
Finding the right location is the single most important decision in developing a new shopping center. Go too far ahead of demand, and you risk empty storefronts. Arrive too late, and you’re competing in an overcrowded market. The sweet spot is identifying communities where population growth, infrastructure, and retail demand are converging—creating the perfect environment for new development.
Where We Buy: Retail Real Estate with JLL's James Cook
Chairman & CEO Jeff Rosenberg: How Big V’s Values Shape Every Deal - Where We Buy #349
Jeffrey Rosenberg, Chairman & CEO, discusses the company’s evolution from its origins as a single grocery store in New York state, to an owner and operator of open-air shopping centers, including The RIM in San Antonio and The Avenue Murfreesboro in Tennessee. He explains Big V’s approach to market research, the importance of core values, and the challenges of acquiring premium assets in today’s market. The conversation underscores Big V’s resilience across market cycles and its commitment to long-term growth.
Consumer Sentiment dips again, but remains above lows hit in April Read More >>
Retail Sales were up in July, driven by strong car sales Read More >>
Job market softens to worst level since 2021 Read More >>
Discounters highlight an otherwise mixed retail earnings season Read More >>
The Checkout Lane
Source: Retail Dive, Chain Store Age, Progressive Grocer
Aldi continues to be the fastest growing grocery chain in the U.S. and will end 2025 with 225 new stores, bringing its total to 2,600 stores. This makes the company the 3rd largest grocer in the country behind Walmart and Kroger by number of stores. In a time of rising prices, more consumers are flocking to Aldi, which saw a 7% increase in traffic compared to less than 2% for the grocery sector overall.
Best Buy has launched a third-party marketplace on its digital platform that will see the retailer enter new categories like outdoor furniture, musical instruments, seasonal décor, and sports merchandise. It marks the largest expansion of Best Buy’s assortment in company history. Purchases can be returned at Best Buy stores or shipped back to the seller.
Bobby’s Burgers, a new fast casual chain from celebrity chef Bobby Flay, announced plans to open as many as 65 locations in Canada, primarily in the Toronto area in conjunction with Falcon Capital. Bobby’s Burgers currently has 9 locations open and 12 more in the pipeline for the U.S.
Burlington has finished remodeling roughly half of its over 1,100 stores with a fresh prototype aimed at making the shopping experience easier with an open layout and better signage that highlights the latest trends. The remainder of the store fleet will be refreshed next year, along with an additional 100 planned new store openings.
Claire’s got a new lease on life this week after previously announcing a plan to close half its stores with an ongoing discussion of liquidating the company down the road. However, private equity firm Ames Watson agreed to acquire the company for $140 million which will now close 291 stores instead of the planned 700.
Dillard’s has gone the extra step to protect its store locations by purchasing the Longview Mall in Texas. Located an hour east of Dallas, CEO Bill Dillard noted that the department store was concerned about the mall falling into the hands of an owner who would defer making improvements to the property. While other department stores like Macy’s and JCPenney are looking to monetize their real estate, Dillard’s seeks to exert more control as they continue to outperform their struggling peers in the sector.
Footlocker’s shareholders approved the company’s merger with Dick’s Sporting Goods, clearing the final hurdle to closing the transaction on September 8th. The combined business would generate over $21 billion annually across over 3,000 stores. Both brands will operate independently but will combine resources when bargaining with vendors.
Off price retailer Gabe’s averted bankruptcy by converting debt into equity for 3 debtholders who will now control the company as it looks to expand nationally. The chain currently has 160 stores open but sees room for as many as 1,000 in the long term. The company has also staffed its senior management with veterans of off-price giants like TJX and Ross.
Kohl’s beat expectations in its most recent earnings release, however sales and profitability continue to decline as the retailer continues to cast about for a new strategy. Excluding the impact from a favorable lawsuit settlement, Kohl’s net income was down 60%, while same store sales fell 4.2%. Interim CEO Michael Bender expressed optimism that Kohl’s could stake its turnaround on its high margin private label merchandise, despite the macro challenges present for their core lower-to-middle income consumer base.
Sycamore Partners closed on its $10 billion acquisition of Walgreens this week. The retail operations will be headed by former Staples CEO Mike Motz, who has familiarity with the Sycamore private equity team. Standalone healthcare operators such as VillageMD, Shields Health, and CareCentrix will be spun off as separate companies; while Boots – the iconic UK pharmacy chain that merged with Walgreens in 2014 - will also be split into its own entity.
Target announced that longtime CEO Brian Cornell will be stepping aside from that role in February 2026 to take on the position of Executive Chairman. COO and former CFO Michael Fiddelke will take the reins as CEO in March, confounding analysts who felt the company would be better served by an outside hire given their recent struggles. Fiddelke outlined his three priorities for Target as being focused on merchandising, experience, and technology.
Meanwhile, Target and Ulta are breaking up in summer 2026, after a five-year partnership that saw Ulta open over 800 shop-in-shops inside Target stores. Analysts noted that the ending of the deal will have little impact on Ulta, given Target’s responsibility for staffing and inventory at the co-branded section. While at least one analyst downgraded Target on the news, noting the serious headwinds Target is under right now in light of tariffs and increased competition.
Walmart is testing an initiative that would give some of its third-party marketplace sellers access to in store customers via an AI-powered tool that allows shoppers to purchase in store directly from the Walmart app. The new system is being debuted at a new Walmart superstore in Cypress, Texas. Customers can scan QR codes in the store that will lead them to additional online assortments for a variety of categories. The company also expanded its next day delivery coverage in New York, Los Angeles, Chicago, Atlanta, and Houston.
The Big View
The United States is not the only country where enclosed malls are facing significant headwinds. China has doubled its number of malls in the last 12 years with over 6,700 currently in operation (the U.S. has just over 1,100 malls). However, despite having four times the population of the U.S., the mall sector there is now seeing the impacts of overbuilding with high profile tenants like Apple starting to close stores in some of the country’s lower performing assets. Yet, China keeps on building new retail centers with over 400 new malls opening in 2024 alone! Find out more about China’s mall scene in this article from Keith Bradsher of the New York Times >>
As consumers become more cautious in a tariff driven economy, some retailers are already emerging as clear winners for their ability to grow market share by appealing to value and convenience. Walmart, TJX, Amazon, Home Depot, and Lowe’s have all seen sales grow in the most recent quarter which could spell trouble for some of their competitors. Read more in this article from the Wall Street Journal >>
Video of the Month: The treasure hunt of TJ Maxx can be thrilling for eagle eyed shoppers, but have you ever wondered exactly where it all comes from and if the designer names are for real? Fashion vlogger Laura VonV does some deep detective work that will help you sort through the racks with confidence. Watch here >>
By the Numbers
Change in Q2 2025 Sales Over Q2 2024
Percent and dollar change, US only
From the Research Desk
Target has been the subject of several think pieces over the past few months as pundits try to decipher how the once vaunted retailer has found itself in a position with falling sales and dissatisfied consumers at a time when other discounters are having a bit of a moment. I’ll refrain from commenting on some of the hotter takes I’ve seen around controversial decisions the company has made other than to note that controversial decisions don’t tend to work out well for $100 billion companies.
Target’s secret sauce was always in the ways they differentiated themselves from their closest competitor, Walmart. Both stores focused on low prices for everyday essentials. Walmart emphasized grocery to a much greater extent than Target but given Target’s more urban/suburban focus this made sense as there were more established brands in the grocery sector in proximity to their stores. In many towns in the country, Walmart is the only game in town for groceries. To counter Walmart’s grocery dominance, Target won by elevating its merchandise mix and store experience to gain a foothold with consumers who felt that shopping at Target was a fun and unique adventure.
The pandemic saw Target initially shift successfully into omnichannel pickup at a time when people weren’t going inside stores much at all. However, that success led them to cut back on in store service to such a degree that the store is now famous for having only 1 or 2 checkout lanes open at any given time and store associates are often hard to find when you’re having trouble locating things, which is also a problem when so many shelves are empty.
For new CEO Michael Fiddelke, fixing the store experience should be job number one. But how do you bring people back inside after alienating them for so long? The answer to this should be in Target’s DNA as well. In recent times, Target moved away from a strategy focused on innovative and stylish partnerships with leading designers to one where they outsourced entire departments to competitors that they thought could do it better like Ulta. Why go to Target for cosmetics from Ulta when there was an Ulta down the street or even in the same shopping center? With the Ulta experiment winding down, now would be the time for the company to get back to what it does best.
Wall Street seemed underwhelmed by Fiddelke’s appointment, sensing the need for an outsider after years of brand degradation. That certainly seems logical, but the good news is that Fiddelke was there when Target was doing everything right and perhaps he will know better than anyone how to get the company back on solid footing.
For contrast, Kohl’s has been limping through 2025 in a leadership vacuum as sales tumble and vendors wonder if they’ll be paid on time. The company still doesn’t have a permanent CEO after their previous choice lasted barely a month before being let go in a scandal involving favoritism to a romantic partner. Kohl’s stock recently moved up on meme trading and an earnings report that was less bad than expected. However, retail is a long game, and Target still has the raw material to get back in the good graces of its core consumer.
Song of the Month: As summer turns to fall, wistful music rules the day at the research desk. So, the timing of Blood Orange’s new album Essex Honey couldn’t possibly be better. Dev Hynes, the UK-born musician and producer behind Blood Orange, has worked with pop luminaries like Lorde, Britney Spears, Cary Rae Jepsen, and others. However, on his first new album in seven years, Hynes takes a bittersweet and nostalgic look back at his formative years under the spell of dreamy indie legends like Yo La Tengo, Everything But the Girl, and Elliott Smith. It’s a hypnotic and intoxicating blending of styles perfectly fit for this reflective time of year. Watch the video here >>
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