Retailers Look to Shrink Brick-and-Mortar Locations
Retailers have a new strategy to increase profits: shrink to fit. For two decades, mall-based apparel companies saturated the market, aggressively adding more stores and building them bigger. Chastened by the recession, however, retailers including Gap Inc. and AnnTaylor Stores Corp. are poring over their holdings, looking for stores they can cut down to size. The effort marks a new phase in the industry's response to the weak economy. After consumers snapped shut their wallets in the fall of 2008, sending sales plummeting, retailers laid off waves of employees and slashed inventory. Now, many of them see re-evaluating their real estate, one of retailing's biggest expenses, as a critical step on their path to recovery.