Is Best Buy a leading indicator of the future of Big Box Retail?

"Small Box Retail"
Willow Glen Business District
Four restaurants in this building",
the Willow Glen Town Center

Today Best Buy announced today that it would shutter 50 of its Big Box stores to focus more on opening, well let's just say Little Box stores. According to Bloomberg News,

"The retailer is closing big-box stores and cutting jobs to reduce costs while boosting online sales and opening smaller locations. The company said it would add 100 of its smaller-format Best Buy Mobile stores in the U.S. in the current fiscal year."

This after news yesterday from U.S. Public Interest Research Group, that younger Americans are leading the trend by driving less, waiting to earn drivers licences, and putting off the purchase of an automobile. The report titled "Transportation for a New Generation", states that for the first time since the end of World War II (yes over 65 years ago), the number of miles travelled by Americans has dropped (as expressed in terms of Vehicle Miles Travelled or VMT). The report gives many reasons why, but emphasized that even when the economy rebounds the trend is expected to continue. I will be addressing the report in more detail in a later post.

Big Box Retail Restaurant

As the Big Box model of retailing begins to break down you begin to see it the shift from a large store format to small shops that can be squeezed into traditional Commercial Business Districts (CBD). In the Willow Glen Area of San Jose, the beer, wine, and liquor retailer Beverages and More has been managing their small footprint store BevMo for a couple of years now. This month Petco will open their small format store "Unleashed" on Lincoln Ave.

So the question is;

• if the Big Box format is possibly on its last legs,
• VMT has been decreasing in the U.S. for the last six years,
• and, the City of San Jose is planning to further reduce VMT in the near future.

Why has the City's Planning Department in recent years approved Big Box format centers such as @First, San Jose Market Place, the Plant, and now has approved a new 45 acre Mega-Mall on one of the busiest expressways in the region? The land, located just north of Highway 85 is one of the last large undeveloped parcels left within the city. Let's not leave a retail dinosaur as a legacy for future generations.

Customer leaving "The Plant" after
waiting 8 minutes to cross
Monterrey Highway