A preview of the content that will be shared at RetailNet Group's first Small Store Summit, April 8th-9th in Dallas, TX. As more big box retailers explore smaller stores and incumbent small box leaders plan to expand store networks, the question of how to win in an increasingly competitive small store world is forefront for both retailers and brands. At RNG's Small Store Summit in Dallas on April 8th - 9th, you'll hear from experienced analysts and operators on what is driving the growth, who will win and lose, and how to maximize profitable growth in these growing formats.

1. RNG S3 Small Store Summit
Future of Small Format Retailing
Pre-Event Webinar
RetailNet Group
Know Tomorrow Today
www.retailnetgroup.com

2. Bring the Future to the Present
Know Tomorrow Today
www.retailnetgroup.com

3. External Drivers Shape The Retail Future
Macro-Economic
Political
Societal
Retail Future
2020
Industry
Technology
Know Tomorrow Today
www.retailnetgroup.com

4. Today’s Agenda
RNG’s Small
Format Channel
Outlook
Winning Small
Format
Characteristics
Future Vendor
Value
Proposition in
Small Stores
Know Tomorrow Today
www.retailnetgroup.com

5. Over Half of Store Based Retail Sales Growth
2014E-2017E Coming From Stores <35K Sq. Ft.
Source: RetailNet Group database
Know Tomorrow Today
www.retailnetgroup.com

6. Discounters, Drug & Small Category Specialists
Driving Small Box Sales Growth
Source: RetailNet Group database
Know Tomorrow Today
www.retailnetgroup.com

7. Consistent Small Box Story with Category Specialists
Source: RetailNet Group database
Know Tomorrow Today
www.retailnetgroup.com

8. 95% of Store Based Retail Stores Growth 2014E-2017E
Coming From Stores <35K Sq. Ft.
Source: RetailNet Group database
Know Tomorrow Today
www.retailnetgroup.com

9. QSR, Convenience, Discounter and Health & Beauty
Channels Lead Stores Growth
Source: RetailNet Group database
Know Tomorrow Today
www.retailnetgroup.com

10. 9 of Top 10 Store Growth Segments Are
Small Boxes <10K Sq. Ft. on Average
*Supercenter Data Not Shown
2009 – 180,873 / 2014E – 165,055
Source: RetailNet Group database
Know Tomorrow Today
www.retailnetgroup.com

11. Supercenters Shrinking Avg. Store Size
Source: RetailNet Group database
Know Tomorrow Today
www.retailnetgroup.com

12. Key STEIP Drivers of Small Stores
Constrained
Consumer Liquidity
Source: RetailNet Group research
Urbanization &
Ex-urbanization
Aging Population
Digital Retail
Know Tomorrow Today
www.retailnetgroup.com

13. Small Box Landscape Summary
• 50% of Sales Growth, 95% of Stores Growth 14E17E Coming from Stores with avg. 35K sq. ft. or less
• 9 of Top 10 Store Growth Segments are Small
Boxes (Avg. Sq. Ft. / Store for Segment <10K)
• Bifurcation – Low Cost & Differentiated
– E.g. Discounters, Fresh Grocery
• Increased Competition for Share of Household
Spend – Shopper Retention
• Downsizing both to new formats and within banners
Source: RetailNet Group
database, research
Know Tomorrow Today
www.retailnetgroup.com

14. Today’s Agenda
RNG’s Small
Format Channel
Outlook
Winning Small
Format
Characteristics
Future Vendor
Value
Proposition in
Small Stores
Know Tomorrow Today
www.retailnetgroup.com

15. Small Box
Food Relevant
Optimizing Store Network & Versioning
Next Step: TargetExpress
Key Attributes to Note:
•
•
First TargetExpress to Open in July
2014 in Minneapolis
Location
–
–
•
•
•
Pilot store will be 20K sq. ft.
Test & Learn  Key Retailer Initiative
for this format before further expansion
Key Departments
–
–
•
•
Located in bottom of apartment
complex & near University of Minnesota
Located near HQ
Will include pharmacy  Trip driver
Expanded grab & go food assortment
Reconfigured Checkout  Optimized
for higher traffic, smaller baskets
Maintains treasure hunt experience
Source: Target Investor Relations,
RetailNet Group research
Know Tomorrow Today
www.retailnetgroup.com

16. Small Box
Food Relevant
Walmart Downsizing to Express Formats
Key Attributes to Note:
•
•
•
•
•
•
•
•
Source: RetailNet Group research
Walmart currently operates 20 Express locations,
majority in NC as a part of pilot
Price points – no convenience premium
Category and department representation - Fresh
foods at a savings vs. local supermarket
competition
Store locations in areas with limited access to
fresh produce / groceries at low prices regardless
of urban or rural real estate
Broad assortments - can do full grocery shop
“To go” foods – Catering to time and money
compressed shoppers, can also serve fill-in or
meal occasions trips
Pharmacy present – Driving trips and capturing
spend with recent healthcare changes
Gasoline (in some locations) – Traffic driver and
one-stop-shop
Know Tomorrow Today
www.retailnetgroup.com

17. Store & Network
Renewal
Source: American City Business Journals
Walgreens Store Renewal Process –
Re-Configured Checkout
Know Tomorrow Today
www.retailnetgroup.com

18. Store & Network
Renewal
Remerchandised Center Store in Small Box
Fresh Grocery with Extreme Value in Produce
Source: Sprouts Investor Relations,
RetailNet Group store visits
Know Tomorrow Today
www.retailnetgroup.com

19. Store & Network
Renewal
Source: RetailNet Group store visits
Increasing Community Space
Esp. Category Specialists
Know Tomorrow Today
www.retailnetgroup.com

20. Localized to the Neighborhood –
Assortment, Services
Localism
Source: Walmart Investor Relations,
RetailNet Group store visits
Know Tomorrow Today
www.retailnetgroup.com

21. Today’s Agenda
RNG’s Small
Format Channel
Outlook
Winning Small
Format
Characteristics
Future Vendor
Value
Proposition in
Small Stores
Know Tomorrow Today
www.retailnetgroup.com

22. 2020 Supplier Value Proposition
Supplier Customer Development Process
Brand Offer
Retailer
Economics
Capabilities
Supply Chain
Capabilities
Demand Chain
Insights & Analytics
Source: RetailNet Group research
Know Tomorrow Today
www.retailnetgroup.com

23. Today’s Agenda
RNG’s Small
Format Channel
Outlook
Winning Small
Format
Characteristics
Future Vendor
Value
Proposition in
Small Stores
Know Tomorrow Today
www.retailnetgroup.com

24. Small Stores – What Do You Need to Solve For?
• Brands
–
–
–
–
Retailer’s Segmentation Strategy
Occasion Based Strategy
Further space compression
Scale and profitably execute shopper marketing in a small
store environment
• Retailer
– Shopper experience & retention
– Merchandising to drive up basket in an in-fill / convenience
trip
– Profitably managing a far more complex environment
Source: RetailNet Group research
Know Tomorrow Today
www.retailnetgroup.com

25. S3 – RNG’s Small Store Summit
April 8th – 9th – Dallas, TX
•
Dates:
– April 8th – Guided Store Tours
•
Food & Non-Food Route
– April 9th – Conference
•
•
•
•
•
•
Morning: General Session
Afternoon: Food & Non-Food Breakout
Location: Hilton DFW Lakes Executive Center
Register at: Events.RetailNetGroup.com
Early Bird Savings Deadline: Feb. 7th
RNG Hotel Rate Deadline: March 17th
Full Agenda: Events.RetailNetGroup.com
Questions: Email Sales@Retailnetgroup.com
Know Tomorrow Today
www.retailnetgroup.com