As brands begin to adapt to their new operating conditions during the coronavirus pandemic, thoughts are turning to how they can emerge from this in a strong position.
For those facing uncertainty over how they will finance their brick-and-mortar presence, one retail concept company may have a solution: free access to store space.
Neighborhoods Goods currently counts three (temporarily closed) locations in Texas and New York, which provide turnkey retail solutions for a revolving cast of brands. Businesses looking to test out stores can sign a temporary lease, access technology and sales staff, and work with the Neighborhood Goods team to runs trials of activations and other retail strategies.
While these locations have been indefinitely closed since March 14, the company continues to sell its partners’ products online and donates up to 10% of sales towards COVID-19 response efforts. It is also planning ahead for when physical retail reopens. Its new project, The Commons, will offer free retail space to brands impacted by COVID-19; instead of a rental fee, Neighborhood Goods will take a small percentage of sales.
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“We were struck by the idea of using our spaces as a platform for people to rebuild,” said Matt Alexander, co-founder of Neighborhood Goods. “With our restaurants and large-scale spaces, we’re well-equipped to do a supportive thing for our brands and communities — something they may not be able to do otherwise — and bring people safely together around the country.”
Physical retail was struggling prior to the coronavirus pandemic, with more than 9,000 stores closing in 2019. New concepts like Neighborhood Goods, as well as Fourpost and Brandbox, emerged as an alternative to traditional retail leasing, for those who were wary of investing in brick-and-mortar before figuring out a successful strategy.
This initiative is not expected to turn a profit, but the company does predict a positive impact on its overall business health, as several brands have already reached out to partner with them in response to the news.
And although the future of the retail store remains unclear, Alexander believes that the financial strain now facing brands will strengthen the value proposition of their product — for both vendors and real estate owners.
“Brands will likely be more wary of signing their own leases, but in much greater need of more-efficient and creative means for customer acquisition,” said Alexander. “Landlords, too, will be looking for partners who can create magnetic, modern experiences.”
There is not yet a confirmed opening date, but The Commons is intended to debut in the summer and is now accepting applications from creators. In addition to retail, it will host restaurant space, live performances and display artwork, just like the traditional Neighborhood Goods spaces. Participating brands will also have free access to the e-commerce platform.
“We’ve always talked about community being at the core of everything we do,” said Alexander. “Now is a good time for us to put that into action and highlight that it’s not just corporate jargon for us, but something truly core to our belief system as people and as a company.”
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