A big-box store, a hyperstore, a supercenter, a superstore, or a megastore is a physically large retail establishment, usually part of a chain of stores. The term sometimes also refers, by extension, to the company that operates the store. The term "big-box" references the typical appearance of buildings occupied by such stores.[1]
Commercially, big-box stores can be broken down into two categories: general merchandise (examples include Walmart and Target) and specialty stores (such as Home Depot, Barnes & Noble, IKEA or Best Buy), which specialize in goods within a specific range, such as hardware, books, furniture or consumer electronics, respectively. In the late 20th and early 21st centuries, many traditional retailers and supermarket chains that typically operate in smaller buildings, such as Tesco and Praktiker, opened stores in the big-box-store format in an effort to compete with big-box chains, which are expanding internationally as their home markets reach maturity.[2]
The store may sell general dry goods, in which case it is a general merchandise retailer (however, traditional department stores, as the predecessor format, are generally not classified as "big box"), or may be limited to a particular specialty (such establishments are often called "category killers"), or may also sell groceries, in which case some countries (mostly in Europe) use the term hypermarket. In the U.S., there is no specific term for general merchandisers who also sell groceries. Both Target and Walmart offer groceries in most branches in the U.S.
Big-box stores are often clustered in shopping centers, which are typically called retail parks in the United Kingdom. In the United States, when they range in size from 250,000 square feet (23,000m2) to 600,000 square feet (56,000m2), they are often referred to as power centers.[3]
Big-box stores in various countries
Australia
Interior of Mitre 10 MEGA, a big-box hardware store in Australia
In Australia, the retail category is known as "large format retail", encompasses bulky goods showrooms and more specialised retail categories within service or Highway commercial type land use zones.
In 1969, Kmart Australia opened its first five Big-box type stores across Australia. The first opened in Burwood East, Melbourne in April, followed by Blacktown in Greater Western Sydney, two stores in suburban Adelaide and a store in suburban Perth.[4]IKEA began operation in Australia in 1975. Bunnings followed in 1995 and Mitre 10 adopted the model with the "Mitre 10 Mega" stores first opening at Beenleigh, Queensland in 2004. Costco has since expanded across Australia since opening its first store in 2009.
There are currently more than 300 power centres, which usually contain multiple big-box stores, located throughout Canada.[citation needed]
China
Most large grocery stores in China are of the big-box variety, selling big screen TVs, computers, mobile phones, bicycles, and clothing. Many foreign names appear, such as Carrefour, Auchan, Tesco, Lotte Mart, and Walmart, as well as dozens of Chinese chains. Most stores are three stories with moving sidewalk-style escalators. Some stores are so large as to have 60 checkout terminals and their own fleet of buses to bring customers to the store at no charge.
Many configurations exist: the hypermarket that sells many kinds of goods under one roof (like French chains Carrefour, Auchan, and E.Leclerc), most of which are integrated within a shopping mall; the supermarket that is a smaller version of a hypermarket; the market located in city centres; the department store, which first appeared in Paris, then opened in other parts of the world; the "category killer" superstore that mainly sells goods in a particular domain (automotive, electronics, home furniture, etc.); and the warehouse store, like Metro Cash and Carry (for professionals only) and Costco, who opened its first store in June, 2017.
To contend against Carrefour, ParknShop opened the first superstore in 1996 based on the concept of a wet market. Most superstores in Hong Kong emphasizes one-stop shopping, such as providing car park services. Today, ParknShop has more than 50 superstores and megastores, making it the largest superstore network in Hong Kong. The first Wellcome superstore opened in 2000 and it has only 17 superstores. In addition, CRC has four superstores in Hong Kong.
Because Hong Kong is a very densely populated city, the sizes of superstores are considerably smaller than those in other countries. Some superstores are running at deficit, such as Chelsea Heights which therefore has stopped selling fresh fish. Furthermore, some ParknShop superstores and megastores, such as Fortress World, belong to the same corporation, Hutchison Whampoa.
India has been going through a retail revolution since the late 1990s, following the introduction of Big Bazaar in 2001. However, even before that, large retail stores were not uncommon in India. Spencer's, a popular hypermart, traces its history as far back as 1863. Likewise, Saravana Stores operating as a large independent showroom format since 1969, continue to grow in a mammoth manner. Saravana Stores operating format is said to be the inspiration for Big Bazaar's Kishore Biyani.
Similarly, conglomerates, such as Raheja's, Future Group, Bharti, Godrej, Reliance, and TATA, have over the last decade ventured into large-format retail chains. However, most of the stores opened in large malls and not as independent big-box format stores, even though small and medium enterprises (SMEs) still account for the majority of the daily consumer transaction needs. However, the most successful consumer retail chain that took the market and penetrated also to tier 2 and tier 3 cities was D Mart, owned by Avenue Supermarkets Limited.
An attempt was made to allow international large format retailers such as Walmart into the country. However, it was successfully opposed by small retailers citing job elimination due to increased efficiency and lowered prices due to fewer losses and lower costs.
Big-box format stores in India were opened by IKEA in the city of Hyderabad, and subsequently, in the city of Navi Mumbai.[citation needed]
In Ireland, large merchandise stores in the style of U.S. superstores were not a part of the retail sector until the late 20th century. Dunnes Stores have traditionally had a supermarket-plus-household-and-clothes model and now have some large stores. Tesco Ireland now runs upwards of 19 hypermarkets across the country.[citation needed]
The big-box phenomenon hit New Zealand in the late 1980s, with the introduction of Kmart Australia and later the "Warehouse" superstore, a local company. Mitre 10 New Zealand opened their first Mega in 2004 at Hastings six months before the Australian Mega store; it opened to great success with 20 more stores opening within two years. Australian-owned Bunnings Warehouse opened its first store in New Zealand in 2006.
In the United Kingdom, Makro and Costco membership-only warehouse club stores have been around for four decades. General merchandise shops along the lines of U.S. superstores are not a large part of the retail sector, but this has been changing in recent years, with the creation of extra-large supermarkets such as Tesco and Asda selling a broader range of non-food goods, typically in out-of-town shopping centres or retail parks. As in the US, such large shops are sometimes called anchor tenants. The growth of online retail and budget retail has led to these chains moving away from the large out-of-town supermarkets which have waned in popularity.
The term "big-box store" is not used in the UK. "Superstore" is sometimes used, but with a slightly different meaning: on road signs it means "large supermarket"; in self-service shop names it denotes an outlet larger than that particular chain's usual size.
Big-box general merchandise retailers such as Target and Walmart are similar to the global concept of a hypermarket, although they do not always have a grocery section, and the term "hypermarket" is not in common use in the United States. "Discount store," "megastore," and "superstore" are sometimes used in addition to the industry term "general merchandise retailer."[5] The category began in 1931, when Fred G. Meyer opened what he called a "one-stop shopping center" in Northeast Portland, Oregon.[6] Meyer's format was imitated by Meijer in 1962 and later by Walmart, Kmart, Target (the discount brand of Dayton department store), and Woolco (the discount brand of the Woolworth department store) all opened.[7] These were called "discount stores" — still an industry term for this type of store — and which between the 1960s and 1980s started to open larger-format stores called "megastores."[8] These stores served the newly enlarged population of customers with cars, being located in suburbs and surrounded by ample parking lots.[7] They were enabled by the decline of laws which prevented large retailers from getting bulk discounts.[7]
Warehouse club stores are another category of big-box general merchandise stores, such as Sam's Club, Costco, and BJ's Wholesale Club. They require membership to purchase and often require purchasing larger quantities of goods at once.
Large, free-standing, shoebox, generally single-floor structure built on a concrete slab. The flat roof and ceiling trusses are generally made of steel, and the walls are concrete block clad in metal or masonry siding.
The structure typically sits in the middle of a large, paved parking lot. The exterior is designed primarily for access by motor vehicles, rather than by pedestrians.[9]
Floor area several times greater than traditional retailers in the sector, providing for a large amount of merchandise; in North America, generally more than 50,000square feet (4,650m2), sometimes approaching 200,000square feet (18,600m2), though varying by sector and market. In countries where rentable space is at a premium, such as the United Kingdom, the relevant numbers are smaller and stores are more likely to have two or more floors.
Criticism
Labor
Big-box development has at times been opposed by labor unions because the employees of such stores are usually not unionized. Unions such as the United Food and Commercial Workers Local 770 and the Joint Labor Management Committee of the Retail Food Industry have expressed concern about the grocery market because stores such as Kmart, Target, and Walmart now sell groceries.[10] Unions and cities sometimes attempt to use land-use ordinances to restrict these businesses.[11]
Urban planning
2011 photo of a Sears big box store with subway station in Rego Park, Queens, New York City, New York. This location closed in 2017 and was afterwards occupied by an IKEA store, which closed in 2022.
Because it is generally inaccessible to pedestrians and often can only be reached by motor vehicles, the big-box store has been criticized as unsustainable and a failure of urban planning.[12][13]
A supermarket is a self-service shop offering a wide variety of food, beverages and household products, organized into sections. This kind of store is larger and has a wider selection than earlier grocery stores, but is smaller and more limited in the range of merchandise than a hypermarket or big-box market. In everyday United States usage, however, "grocery store" is often used to mean "supermarket".
Tesco plc is a British multinational groceries and general merchandise retailer headquartered in Welwyn Garden City, England. The company was founded by Jack Cohen in Hackney, London, in 1919. In 2011, it was the third-largest retailer in the world measured by gross revenues and the ninth-largest in the world measured by revenues. It has shops in Ireland, the United Kingdom, the Czech Republic, Hungary, and Slovakia. It is the market leader of groceries in the UK.
A grocery store (AE), grocery shop (BE) or simply grocery is a retail store that primarily retails a general range of food products, which may be fresh or packaged. In everyday U.S. usage, however, "grocery store" is a synonym for supermarket, and is not used to refer to other types of stores that sell groceries. In the UK, shops that sell food are distinguished as grocers or grocery shops
A variety store is a retail store that sells general merchandise, such as apparel, auto parts, dry goods, toys, hardware, furniture, and a selection of groceries. It usually sells them at discounted prices, sometimes at one or several fixed price points, such as one dollar, or historically, five and ten cents. Variety stores, as a category, are different from general merchandise superstores, hypermarkets, warehouse clubs, grocery stores, or department stores.
A hypermarket or superstore is a big-box store combining a supermarket and a department store. The result is an expansive retail facility carrying a wide range of products under one roof, including full grocery lines and general merchandise. In theory, hypermarkets allow customers to satisfy all their routine shopping needs in one trip. The term hypermarket was coined in 1968 by French trade expert Jacques Pictet.
Discount stores offer a retail format in which products are sold at prices that are in principle lower than an actual or supposed "full retail price". Discounters rely on bulk purchasing and efficient distribution to keep down costs.
A warehouse club is a retail store, usually selling a wide variety of merchandise, in which customers may buy large, wholesale quantities of the store's products, which makes these clubs attractive to both bargain hunters and small business owners. The clubs are able to keep prices low due to the no-frills format of the stores. They are distinguished from traditional cash-and-carry wholesale businesses in that their warehouses are substantially larger in size, and they do not cater purely to businesses but also allow some or all types of consumers to obtain memberships. They are also distinguished from warehouse stores in that they usually charge annual membership fees, and require presentation of proof of membership at the warehouse entrance and again at the point of sale.
ParknShop is one of the two largest supermarket chains in Hong Kong, the other being Wellcome. ParknShop operates more than 200 outlets in Hong Kong, Macau and mainland China.
Real Canadian Superstore is a chain of supermarkets owned by Canadian food retailing giant Loblaw Companies. Its name is often shortened to Superstore, or, less commonly, RCSS.
Big C, operated by Big C Supercenter Public Company Limited under Big C Retail Corporation Public Company Limited, is a grocery and general merchandising retailer headquartered in Bangkok, Thailand. Big C is as of 2016 Thailand's second-largest hypermarket operator after Tesco Lotus. It has operations in five countries, namely Thailand, Laos, Cambodia, Vietnam and Hong Kong.
Shelf-ready packaging (SRP) and retail-ready packaging (RRP) refers to the packaging of a product so that it is delivered to a retailer in packaging which is optimized for efficient stocking and sale.
Big W was a British retail chain owned by the Kingfisher Group in the United Kingdom, which operated between 1998 and 2004. Big W stores were large format out-of-town megastores that featured products from all of Kingfisher's main retail chains at the time, consisting of Comet, B&Q, Superdrug and Woolworths.
Tesco has expanded its operations from the United Kingdom to 11 other countries. Tesco pulled out of the United States in 2013, but continues to see growth elsewhere. Tesco's international expansion strategy has responded to the need to be sensitive to local expectations in other countries by entering into joint ventures with local partners, such as Samsung Group in South Korea, and Charoen Pokphand in Thailand, appointing a very high proportion of local personnel to management positions. It also makes small acquisitions as part of its strategy: for example, in its 2005/2006 financial year it made acquisitions in South Korea, one in Poland and one in Japan.
Jack's was a British discount supermarket chain based in Welwyn Garden City, Hertfordshire, owned by Tesco.
The retail format influences the consumer's store choice and addresses the consumer's expectations. At its most basic level, a retail format is a simple marketplace, that is; a location where goods and services are exchanged. In some parts of the world, the retail sector is still dominated by small family-run stores, but large retail chains are increasingly dominating the sector, because they can exert considerable buying power and pass on the savings in the form of lower prices. Many of these large retail chains also produce their own private labels which compete alongside manufacturer brands. Considerable consolidation of retail stores has changed the retail landscape, transferring power away from wholesalers and into the hands of the large retail chains.
↑ Joseph, Lawrence (2014). An Empirical Mega-Analysis of Retail Locations: Value Platforms, Real-Estate Maturity, and Deployment Decisions. Fred Neeson. ISBN978-0-9960626-0-2.
↑ Leeson, Fred (May 2013). My-Te-Fine Merchant: Fred Meyer's Retail Revolution. Arizona State University. S2CID168399700.
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