Got a drone landing pad?
Well, why not?
Has your apartment complex got a drone landing pad?
That’s right, apparently a high-rise in LA is installing a drone landing pad so residents can take delivery of a canned ham or a copy of Fifty Shades of Grey ordered from their favorite online retailer.
In July, 7-Eleven, and Flirtey, an independent drone delivery service, completed the first fully autonomous drone delivery to a customer’s residence.
Yes, it’s a brave new, unmanned aircraft world of retail. That was the buzz at last week’s 2017 Tarrant County Commercial Real Estate Forecast.
This Jetsons-style future sounds pretty cool, but it’s driving retailers nuts – or maybe out of business.
Stephen Coslik, chairman of The Woodmont Company, the Fort Worth-based commercial real estate and consulting firm, says the changes in retail brings some challenges. That’s particularly true for some of the many Fort Worth developments going vertical at this very moment. Retailers who may have once been more than happy to join the multi-use development party are now thinking twice about putting their hard-won dollars into bricks-and-mortar, says Coslik.
“Retail is changing,” he says. “A lot of retailers who would have come into these centers five years ago,” are now being cautious.
Even a retailer who is not suffering too much under the boot heel of online retailing, Walmart, is keeping things close to its blue vest. The Bentonville, Arkansas, retail giant doesn’t plan on opening many locations locally or across the country in the next year. Instead, Walmart will be spending dollars toward attracting online customers.
In August, Walmart agreed to buy e-commerce startup Jet.com for about $3.3 billion in a bid to compete with juggernaut Amazon. While jobs on the retail store floor may be slowing, there is growth in the back end, in the fulfillment center warehouses. That’s happening locally. Last week, Amazon.com announced it would build its third fulfillment center in Coppell, a 1 million square foot site that will employ about 1,000.
But for the many new developments coming online in Fort Worth, getting retailers could be an issue. Build it and they will come? Better give them a damn good reason.
For Brandom Gengelbach, the new Fort Worth Chamber of Commerce Executive Vice President of Economic Development, it is an issue he’ll keep in mind as he works to sell the city to retailers.
“When we go to ICSC [International Council of Shopping Centers], we’ll have to have our message ready to show retailers why they should be here,” he says.
Speaking at the Real Estate Forecast, Coslik said retailers like Sears are on thin ice and others, like Macy’s and Penney’s will continue to cut stores. “Department stores are in trouble,” he said. Even former retail favorite sons like Target are suffering, as the company’s holiday sales missed the, well, the target. And the malls that are home to these retailers? They’ll suffer too, he said.
But there are some bright spots: T.J. Maxx and Ross Stores are doing well. Those stores sell to “women who want to find a deal,” says Coslik.
And while e-commerce sales have grown exponentially, that segment still represents only a small percentage of retail sales, says Coslik.
“Eighty percent shop online, but 60 percent still want to touch it, see it,” he says. In other words, he says, there’s still a place for brick-and-mortar stores, but those retailers have to be careful where they invest in those sites.
That’s why you see Amazon.com adding some brick-and-mortar locations, too. Customers still like the physical act of shopping, at least some of the time.
Meanwhile, a drone landing pad in your backyard? Might not be a bad investment. Think about a Triple-Berry Super Java Slurpee landing in your backyard in the middle of a Texas triple-digit August day? Doesn’t sound too bad.