For decades ,Wal Mart “America’s retailer” built its stores on the edge of town where land cost were low. People drove across town to shop at its stores.
Rising gas prices is slowly reshaping where we shop. Driving cross town can reverse cost savings as a result many american’s are shopping closer to home. This trend is affecting the big box discounters. While Macy’s, Penney’s have seen major increases, Wal Mart stores has declined in the last two years.
Wal Mart is losing the lower end to the 99 cents stores and the middle income shoppers to Target and local Supermarkets. The 99 only cents stores and similar stores are expanding rapidly due to the soft commercial real estate market, moving into existing neighborhoods.
Of the big box retailers only Costco Wholesale is seeing continued growth. Unlike Wal Mart , Costco shoppers tend to be middle and higher income.
While high gas prices and competition from the 99 cents stores and Target has hurt Wal Mart, traditional Supermarkets are holding steady for now.
Posted on May 25, 2011