Melbourne Central named Australia’s most productive centre
Shopping centre managers are becoming more aware of the fact that wasted space is wasted money, and tightly focused retail spaces can turn outsize profits.
For example, Melbourne Central, a 55,000sqm shopping, office and transport hub, has received national recognition as Australia’s most productive centre based on sales per square metre of $14,763, according to the 2019 Big Guns survey. In large part, this success can be sheeted home to the fact that it has made some small spaces very high-performing.
Curation is key
One top performer is Secret Sneaker. It first started operating as a pop-up concept store in Melbourne Central, and in October 2017 it was rolled out there as a full in-line store.
Capitalising on the trend of resale of fashion, Secret Sneaker’s success stemmed from curating some of the most collectable sneakers and clothing. Successful smaller stores know that vast amounts of product are not necessary with thoughtful curation, choice and solid online support.
Edwin Low, the owner of Secret Sneaker, believes the success of the Melbourne Central store can also be attributed to its unconventional cutting-edge design – not what you’d expect to see in a shopping centre.
The strong performance of the Melbourne Central store has led to the brand’s expansion nationally, and it still remains the most progressive and best performing in the portfolio and one of the most successful consignment stores in Australia.
Kiehl’s is another example of an effective small-store format. It opened its first in-line store at Melbourne Central in 2013 in just 23 square metres. Today this store remains the most profitable in the company’s portfolio and is Melbourne Central’s most productive beauty brand based on sales per square metre.
Ikea reinvents itself
International furniture retailer Ikea has changed direction too, moving away from its signature vast warehouses to smaller stores with more personalised service.
The first of its “home planning studios”, located at Warringah’s Westfield Shopping Centre in Sydney’s Northern Beaches, has a floorplan of just under 100sqm – a fraction the size of its existing 37,000sqm sites across the country.
Ikea Australia country manager Jan Gardberg said that Australian shoppers wanted convenience and accessibility, and it was essential for retailers to answer that need.
At the new store, inventory is kept to a minimum; instead of endless shelves of product, digital shopping displays are mounted on the walls to allow the customer to select items and have them delivered to their homes.
“With the Ikea home planning studio we have reinvented the traditional Ikea experience for a different audience, with different shopping needs putting digital at the heart of the customer’s journey. However, the digital experience is delivered in our most personalised approach yet,” Gardberg told Inside Retail.
Ikea is trying out different, smaller stores in other parts of the world, including Paris and even in its home base of Stockholm.