Retail Stores: How Big Is TOO Big?

Great Debates
1

This has been on my mind…since a local grocery chain opened a local “megastore”. This place is so huge that I get lost in it! Now, theoretically, the bigger a store, the more efficient it is…the same overhead expense can be spread out among a larger volume of sales…this helpsefficiency. But, economists speak of “diminishing returs”-that is, at some point expenses actually RISE as a an operation becomes too large. So, is there an OPTIMUM size for a retail store? Or, are the captains of retailing just going to keep making larger and larger stores?
I understand that the concept of huge, warehouse-style retail operations comes from FRANCE (the “hypermarkets”)…I thought the French were enamoredof small shops.
All the same, I prefer to shop in smaller establishments…these huge places just turn meoff! :eek:

2

One thing you failed to touch on was that the huge stores offer convience for those who would learn how to navigate them. I think you may have tried to fit this in, in the efficiency part… although the store is aiming for efficiency and the consumer is aiming for convience also often times the larger discount stores are much cheaper than the smaller speciality stores. So actually if one is willing to take the time to learn the ins and outs of the superstore they would not only save themselves time but money as well.

         Now is reference to how big is too big.. you could adress this as.. hypothetically a store is too big when it is so large people actually become fatigued due to the extensive amount of cart pushing and walking. But until you reach this level I think the benefits exceed the costs.

        Overall people just feel intimidated by the large stores.. they think they are far to big to handle. Also if you are in search of a single item a speciality store would be much better to go to. If in search of a variety of different things.. I would take the superstore anytime.
3

It’s too big when you can do simultaneous maintenance on two 747s and the space shuttle.

4

How big is too big? When the size exceeds the ability of the management to manage it well. And that depends on the management techniques used.

Actually you are confusing two things in your OP. The physical size of the store in question and the organizational structure to manage a given store or a chain of stores. One might argue, for instance, that huge malls are not really different than superstores. Certainly not from a physical standpoint wrt how customers have to deal with it.

And if you really just want to rant about not liking Walmart or some such thing, then there isn’t an answer. :slight_smile:

5

An easy measure of this is profitability; if a store is profitable, it is not too big. When the size of the store interferes with the logistics of supply, or the cost of carrying a massive inventory negatively impacts the bottom line, then it is too big.

6

My two cents when thinking of my very own local HellMart SuperCenter.

I tend to go there if I need a large quanity of mixed “stuff.” For example, I need 10 bags of top soil, some blank CD’s, a crock pot, and a week’s worth of food. Then I’ll bite the bullet and go to HellMart.

Good points of the super store.

  • they have everything.
  • they are low cost.

Bad points (at least of the local one).

  • crowded.
  • dirty
  • 3000 checkout lanes with 3 working.
  • time. Because of crowds and size it may become inefficent to only get a few items here. You may waste more money in time than you save.
  • have driven many local merchents out of business.
  • increased traffic problems.