Smaller shop formats planned for collection of online orders as customer demand grows
Department store group House of Fraser is scouting for smaller stores of just 1,500 sq ft that could be used to fulfil orders for click-and-collect customers.
Sources told Retail Week that House of Fraser has been talking to landlords about ways of infilling in locations where it cannot open a large-scale department store, while capturing online spend.
It would be the first time a retailer has opened stores specifically for their click-and-collect operations and reflects the growing demand from consumers to buy online and pick up in store.
Research from Deloitte showed that multichannel consumers - those who use more than one channel such as store, online or catalogue before making a purchase - spend 82% more per transaction than customers who only shop in store.
The average expenditure for multichannel customers across clothing, home and electrical categories is £116 per transaction, compared with £64 for store-only customers.
House of Fraser recently launched ‘Buy & Collect’ in its 61 stores. Sources said it now wants to find shops as small as 1,500 sq ft in under-represented areas for this offer. The average size of a House of Fraser store is about 100,000 sq ft.
The department store group is also looking at other formats, such as smaller out-of-town stores as a way to grow its national coverage. It has also said it would consider opening standalone Biba stores, the brand it acquired in 2009.
House of Fraser chairman Don McCarthy would not confirm whether click-and-collect stores were an option for the potential smaller format stores.
He said: “We have got loads of options for small format stores. It could be a Biba standalone store, it could be a click-and-collect store. We have not yet identified what type of stores they could be.”
Retail Week Knowledge Bank director Robert Clark said the move makes sense for House of Fraser, as it does not have national coverage.
He said the service would be useful for customers who “don’t like hanging around at home” waiting for deliveries, but cautioned: “It’s quite an expensive way of doing things. The jury is out on whether it will prove economical.”
➤ See the Multichannel special in the centre of this issue