Category: Connexus Magazine

Lots to consider when evaluating your store’s roof

If you’re a facilities manager who’s sick of dealing with a leaky roof, then take some advice from a seasoned roofing executive: read your lease, know which party is responsible for what and work with your landlord for positive action. That’s the message from Art Rankin, Chief Operations Officer for the Chalfont, Pa.-based roof management and contracting company CP Rankin Inc., who says retail tenants often underestimate their importance to the landlord and their willingness to support them.

“We often find retailers have not read their lease, or maybe the real estate department has read it but not the operations or facilities departments,” Rankin said. “The very first thing to do is to understand your rights and requirements as lessee. And if you’re a big anchor store, then you have a lot of clout, and your business is important to the landlord. A big problem for retailers is not knowing their rights or knowing the willingness of the landlord to take care of roofing issues based on their business.”

Facilities managers should document roofing problems, including repairs and expenditures, and contact the FMs at adjoining stores to see if they have had similar issues.

“It’s really about working together in close collaboration with the landlord to ensure the leak repair is done properly, and if the leaks continue, you need to request reroof options,” Rankin said.

For retail companies that own their facilities, the question of whether to repair or replace a damaged roof involves many factors, including:

• Extent of the damage. ”If one section of the roof has been punctured but the rest is in decent shape, a patch and some minor repair work might be all that’s needed. But if there is significant bubbling, delaminating or seam separation with the rubber roofing membrane – if it looks a bit like alligator skin and is no longer pliable – then significant leaking is possible, and the roof likely must be replaced,” Rankin said.

Degradation of the roofing membrane can allow water to seep into and waterlog the roofing insulation. From there, the water can reach the wood, metal or concrete roof interior and cause leaks throughout the store, making it difficult to pinpoint the source of the leak.

• Local building codes. If your store does need a new roof, one way to limit the cost is a reskin or go-over, in which a new rubber membrane is installed over the damaged one. But most building codes will not allow more than two roofs on one structure, so this is a one-time option. After that, the roofing materials must be removed down to the decking and the building reroofed.

• Long-term plans for the store. How committed is your company to the retail location? If your store is thriving, and will not relocate, investing in a new roof might be the best option. But if plans are uncertain, it might be wiser to patch the roof and try to extend its life, especially if the building might be sold.

• Age of the roof. Most roofs last 20 to 25 years, depending on the roofing materials, installation, whether roof maintenance has been performed regularly, and the weather the roof is subjected to. A preventative maintenance program can extend roof life, but if an older roof has been neglected or has required costly repairs in the past, a new roof might be in order.

Rankin recommended FMs contact a reputable roofing consultant to obtain a detailed report on their roof, complete with visual inspections and scans for moisture. A roofing consultant can determine the life expectancy of the roof and then work with a certified roofing management and construction company to develop strategies for maintenance, repair or replacement.

By: Nick Fortuna

Looking for new business? Don’t rely on social media posts on Facebook and Twitter to develop your contacts. Concentrate your efforts on social selling, which is a deliberate process of finding, connecting and developing business relationships online.

LinkedIn is the best place to develop your social selling strategy, according to Terry Sullivan, founder of BuzzPro, a digital marketing firm.

“In the B2B space, LinkedIn is the number one networking tool for finding good prospects and clients,” said Sullivan. It makes it easy to build trust and keep in touch with all of your key contacts and prospects.”

Where to start

The first step is to use LinkedIn on a daily basis, even if it’s just for five or 10 minutes. “Check your messages, check to see who has reached out to connect with you,” Sullivan said. “Make sure you click on the notifications tab and reach out to anyone who has a birthday a new job or a promotion.”

Find an article you think would benefit your contacts and share it with them to start building a trusting relationship. “People don’t want to be sold over the internet; they want to be helped. They want you to help them solve their problem,” Sullivan added.

Improve your own profile. How many contacts do you have? Sullivan said the optimal number of contacts on LinkedIn is 501-plus, because it demonstrates to other LinkedIn members that you are serious about building a professional network.

Don’t make the mistake of only listing your title in a 120-character phrase at the top of the LinkedIn page. “You have to have a strong brand; tell people who you are, what you do and how you can help them,” Sullivan said. “Write your summary section in first person. Remember that you’re not looking for a job; you’re trying to let people know you want to do business with them.”

Searching for prospects

When searching for prospects, look for people who have photos in their profiles and who have a summary section that defines their brand. When you’re ready to reach out to someone, send them a personalized message asking for the connection.

“Make it more about them than you,” Sullivan advised. “Once they connect with you, send them a thank-you note and give them something – an article, a link to your website – that can provide value.”

But making that LinkedIn connection isn’t enough. “Nothing really happens in the business world with LinkedIn until you take your online discussion offline,” Sullivan added. Pick up a phone and call that prospect once you’ve made the connection.

Finally, reach out at least once a month to your top prospects via email or phone. People like to do business with those they know, trust and like, and the best way to build that kind of relationship is to stay in contact with them, Sullivan advised.

By: Maru Lou Jay

 

Developing a fact-based, well-thought out snow and ice removal program requires some substantial upfront work, but the results are worth it. “Companies can realize 25 percent savings and even more on their costs,” said Sean Hartnett, Vice President, Business Development at SMS Assist, a technology-based solutions architect for maintenance needs.

1. Determine your scope of service based on your business needs.

Retailers that carry essential goods and supplies that customers will want before, during and after a storm – home improvement and grocery stores, for example – need to have snow and ice removal contractors on site early and often.

“But if I’m an apparel retailer or a jewelry store, I don’t need to pay to have my contractors catching the flakes out of the sky,” Hartnett said. “You won’t see an increase in revenue or foot traffic during the event to begin with, so you’d be compounding your losses.”

Time in the calendar year is also key in determining snow removal. About 40 percent of retailers’ revenues are generated in November and December, and nationally more than 30 percent of snow falls during that time. While you might want to beef up your snow removal during those two months, by late January you can adjust to a less aggressive trigger or clear less of your lot.

2. Base your decisions on good data. “When most organizations make the choice about going with a seasonal, per event or per push contract, based on either no data or poor data, they’re going to make bad decisions,” Hartnett said. “You need to understand the actual weather; the number of events, the types of events, the probability of those events and match that up with different cost structures.”

The problem is that much of the widely available snow data (including that from the National Weather Service) is based on inexact measurements. Retailers may also go back only five years or so to determine the average snowfall in an area; Hartnett recommends going back at least 50 years.

“FMs should consider working with a company that analyzes available data and can match that with pricing information,” he said. “It’s incredibly complex; people try to oversimplify this, and if you do that, you’re literally taking the dice and rolling them.”

3. Start the process early. Snow removal contractors are competing with a lot of other users, including municipalities and large retailers, for a finite supply of deicer. The longer they wait to order supplies, the more expensive those supplies may be.

The earlier you lock up a contract, the earlier the removal companies can get their supplier and the better the pricing you’re likely to get.

4. Audit on the back end. Snow removal is much more complex than janitorial and floor care service. With seasonal contracts, contractors have an incentive to work as infrequently as possible, while per push or per event contracts encourage them to provide more services.

“You want to make sure you audit their performance and compare it to other locations in that area,” Hartnett said.

5. Use centralized decision making. “When decision making on snow and ice removal is centralized, it’s more likely to be based on a very structured set of rules, even if those rules are flawed,” Hartnett said. “But they are likely to be better than individuals at stores randomly making decisions.”

To develop the best strategy for their companies, FMs must understand what it is they’re trying to achieve. Do they want to spend less and assume more risk? Or spend more and have less risk? The answers will help determine which type of snow and ice removal services are right for their stores.

By: Mary Lou Jay

Founded over 50 years ago in Northern California, PRIDE Industries is one of the country’s largest employers of people with disabilities. It seeks out contracts for facility maintenance, commissary, landscaping and other services with both public and private sector employers and hires individuals with disabilities to fill them. It also places them in private sector jobs.

“We currently have about 5,600 employees, and about 3,200 of them are people with a range of disabilities from intellectual and developmental disabilities to mental health, hearing and sight impairment,” said Vic Wursten, PRIDE’s Senior Vice President, Rehabilitation Services. Jobseekers with disabilities come to the organization through state vocational rehabilitation agencies, disability services groups and the Veterans Administration.

Moving workers into the community

For many, employment with PRIDE is a stepping stone into the private workforce – more than 300 private companies have hired workers through PRIDE. “Our focus really is to take a person with disabilities, provide them with pre-vocational and transitional skills training necessary for them to be successful in their jobs, find the right employer match and then provide support post-employment to make sure that they are successful. So it’s a continuum,” Wursten said.

“On average, we place about 500 to 600 people each year into community employment, which means they are in an integrated work environment and they are competitive in that they make the minimum wage or better,” he added.

PRIDE’s recent work with Amazon illustrates the range of services it provides to ensure job placements are successful. The organization contracted with Amazon last July to eventually provide 2,000 people for its California sort center and Prime Now locations.

“We identify the person with a disability who might be a good fit, and then do simulated work environments to make sure there is a competency level that will allow us to train them and make them successful in employment. We do all the background and drug tests, then move them to the Amazon facility and provide the job coaching support they need after they are hired,” Wursten said. The costs of the training and the after-employment support are covered in part by Amazon and California’s Department of Rehabilitation.

PRIDE can provide similar training and support for anyone it places. Their initial training focuses on soft skills, making sure the job seeker understands the importance of coming to work every day on time, of learning to take instructions from supervisors and of working well with their co-workers.

In addition, PRIDE offers basic certificated vocational training for construction, electronic manufacturing and warehousing and logistics as well as CIMS (Cleaning Industry Management Standard) certification for custodial trainees. It is currently developing programs for call centers and certified nursing assistants. PRIDE can also work with employers to create internship opportunities, so as people finish their training, they move into short internships at those companies.

By earning these certifications and gaining experience working at entry-level jobs, employees with disabilities build resumes that include the training and experience required to help them find better jobs in the community either with or without PRIDE’s assistance.

PRIDE employs coaches whose role is to give the newly-placed people with disabilities the assistance they’ll need to be successful in their new positions. Sometimes a job coach may spend two to three hours a month with the new employee just to make sure they and the employer are happy. Other times, the coaches may work with the individual one-on-one over a period of a few weeks to make sure they understand the job tasks and are able to complete them.

“We always act as an intermediary between the employee and the employer. This allows us to mitigate any issues that come up. Rather than firing someone because of a workforce issue, the employer can come to us so we can work with the employee to ensure success in terms of long-term employment,” Wursten said.

Highly-rated, loyal employees

While many companies have realized the benefits of hiring people with disabilities, others still harbor some misconceptions. “Many people think there’s a safety issue, but that is absolutely incorrect; the numbers prove they are very safe workers, “ Wursten said. Businesses may worry about the cost of accommodating employees with disabilities, but more than half of all job accommodations cost nothing and the rest typically cost less than $500. Tax incentives like the Work Opportunity Tax Credit (WOTC), which can provide a business with a tax credit of up to $9,000 for two years, can help offset any additional costs.

Potential employers may also be concerned about the job performance of someone with disabilities, but after a training period, those employees have job performance ratings and retention rates equal or higher than coworkers without disabilities.

Other businesses may wonder how a person with disabilities will fit into their workplace, but Wursten said companies who have hired them find their inclusion to be a very positive experience for everyone. “They provide a different level of diversity,” he added.

In addition, unlike many workers from temporary agencies, people with disabilities will not be looking for new jobs. This means employers spend less on training. “These are individuals who have struggled to find employment and meaning in their lives, and paychecks provide them with an incredible amount of self-satisfaction,”  Wursten said. “The disabled workforce is very loyal and very happy to be working.”

(*Alabama, Arkansas, California, Florida, Georgia, Hawaii, Kentucky, Louisiana, Maryland, New Jersey, New Mexico, Texas, Virginia, Washington and Washington D.C.)

By: Mary Lou Jay

How Trade Schools and CTE Programs Can Help Fill the FM Gap

It’s no secret the FM industry is facing a major shortage of skilled professionals. In fact, skilled trade positions are now the hardest jobs to fill in the United States. According to some estimates, there are more than one million vacant jobs in the trade, transportation and utilities sector alone. Considering these shocking statistics, it sometimes seems there will never be enough qualified, skilled workers to fill all the open facilities management positions.

Fortunately, there is hope for the future. Trade and technical schools are working diligently to groom students to fill the cavernous skilled trades gap. These schools are like untapped gold mines for the facilities management industry.

Known as career and technical education (CTE), these programs prepare students for an array of high-skill, high-demand careers, including those in the retail facilities management arena. CTE serves 94 percent of all high school students, including males and females from a wide range of backgrounds. The average high school graduation rate for students concentrating in CTE programs is 93 percent, compared to an average national freshman graduation rate of 80 percent. In the 2013-2014 school year, there were more than 7.5 million high school CTE participants (students who took at least one credit of CTE), according to the Office of Career, Technical and Adult Education.

On the postsecondary level, CTE students are also a diverse group, but more likely to be older, married and working part or full-time. There were nearly four million postsecondary CTE participants and 121,952 adult CTE participants in the 2013-2014 school year.

“CTE provides students with the skills needed in a variety of facilities management areas, including HVAC, plumbing, electrical, landscaping and energy management,” explained Dean Baker, Manufacturing Technology and Machining Instructor with Francis Tuttle Technology Center in Oklahoma City and Trade & Industrial Education Division Vice President for The Association for Career and Technical Education® (ACTE). ACTE is the largest national education association dedicated to the advancement of education that prepares youth and adults for careers.

The association’s Trade and Industrial Education Division was created to promote the philosophy and objectives of trade and industrial education across the nation. Baker said retail facilities management companies should consider turning to ACTE as they struggle to fill open skilled trade positions. “ACTE can be an excellent resource for finding these programs in the areas of interest for PRSM members,” Baker added.

Make the Trade

According to Baker, there are countless ways service companies and retailers can work with CTE programs to build partnerships and fill the skills gap. Here are just a few options:

Volunteer

“One way for service companies and retailers to enhance programs is to reach out to CTE Educational Institutions in their area and volunteer to serve on an advisory committee, or assist with local Career and Technical Student Organization (CTSO) leadership and skills contests,” Baker pointed out. You could also volunteer to do a class presentation in your area of interest or personal expertise, he suggested.

Teach a class

If you’re looking to join forces with a CTE program and recruit soon-to-be graduates, you may also consider teaching a class in your specialty trade. However, there may be different credentialing requirements in your area.

“Different states and CTE Educational Institutions have particular procedures that they must adhere to,” Baker explained. “PRSM members should reach out to the CTE Educational Institutions in their respective states and areas and inquire about the requirements. Many states and CTE Institutions have alternative licensing for skilled trade and industry representatives.”

Offer scholarships

What better way to win over future tech professionals than to help pay for their education? “Scholarships for students pursuing a certification or degree at a CTE Institution are an excellent avenue for PRSM members to incentivize a particular skill set that they see a present or future need for,” Baker emphasized.

Hire interns

Work-to-hire programs are yet another effective way for retailers and service companies to tap into tech schools. “Internships for students enrolled in a program of interest for PRSM members are another way to help incentivize student interest and involvement in these CTE programs,” Baker said. “PRSM companies should contact CTE Institutions in their areas and propose an internship that can meet the needs of all involved.”

Reward teachers

Last but not least, PRSM members can connect with tech schools by offering awards to outstanding teachers and institutions.

“CTE teacher and institution awards are another way to promote and attract quality instruction in PRSM members required skill sets,” Baker said. For instance, Harbor Freight recently awarded 10 CTE teachers and institutions a shared cash reward for their excellence in teaching and facilities. “The top three award winners shared a $10,000 cash award,” he explained. “ACTE worked with Harbor Freight to assist them with these awards for quality CTE education.”

Boundless Benefits

Trade and technical schools could be the silver bullet for retailers and service companies looking to fill the skills gap. According to Baker, there are endless advantages to working with these schools.

“One benefit is PRSM members can be involved via Advisory Councils/Committees with CTE Institutions to assist in awareness of evolving technologies and innovations in a particular career field,” he said. “Working with CTE Institutions, especially via Advisory Councils/Committees, allows companions to identify areas currently available and provide input and financial incentives.”

Of course, another major advantage is gaining access to classrooms full of skilled workers in training. “By working with CTE Institutions, PRSM members can attract local talent to their organizations and benefit the community as well,” Baker said.

Baker encourages PRSM members to lean on ACTE if they want to reach CTE programs on a national level. “ACTE is an organization that works with and for CTE institutions and teachers, and it would be beneficial to reach these institutions and teachers nationally,” he said. Additionally, ACTE works at the national policy level for all of CTE, he said, which also ultimately benefits retailers and service companies.

For more information about ACTE, visit www.ACTEonline.org. 

By: Amy Bell

Combination of hands-on learning, mentors and career planning proves successful in Canada

Tackling the challenge of training in the facilities management and maintenance industry requires passion, commitment, creativity and an abundant source of energy.

At Freshco, an Oakville, Ontario-based retail facilities firm that provides maintenance, project and reconstruction services across Canada and the eastern United States, training is critical for the 76 company employees and 370 technical employees who operate as subcontractors for the company.

“There is no difference in the workforce challenges in Canada and the United States,” said Mandy Rennehan, Blue Collar CEO and Founder of Freshco. As experienced trades people age, there are fewer young people to take their place because they don’t understand the exciting and creative opportunities that exist in retail facilities maintenance and reconstruction industry, she said. “We have to make it fun to come to work and we have to give them the skills to succeed.”

Because Freshco’s training program is designed to teach people who may not have any experience in a trade, Rennehan focuses on hiring employees based on personality and a willingness to learn. “We want people with a real passion to learn and to make a difference in everything they do – even in an industry that is not glamourous,” she explained.

Improving the image of the industry is possible – just look at restaurants and chefs, said Rennehan. “Chefs and those who work in the restaurant industry still work horrible hours for low pay, but television shows about chefs have made the industry attractive to a lot of young people.”

Although she does not foresee numerous reality shows that feature retail facilities techs performing their tasks in timed competitions, Rennehan does point to well-designed training programs as one way to elevate the perception of careers in the trades.

“Our entire training program takes about one and a half years to complete,” Rennehan explained. Only 5 percent of training occurs in the classroom, and the rest is hands-on learning while they work. “Three people watch over and support each new employee,” she said. “This does mean more overhead costs but the only way to develop quality employees is to give them time to learn.”

In addition to giving people a chance to learn a variety of skills, Freshco’s program is flexible enough to let people move into other areas. “We review where they are now, where they want to be in three months, and what skills they need to reach their goals,” Rennehan said. “Because we are a diversified company, there are different avenues each person can explore.” Career planning also extends into the future, with employees identifying two, five and seven-year career goals.

“I believe that it is important to give people a future that they can see,” Rennehan said. Extensive, focused training combined with career planning benefits the company in many ways. Not only are employees more invested in doing their jobs well today, but they are more likely to stay with the company long term. “The company’s investment in our people builds a higher level of trust and transparency, which creates better managers and technicians,” she said. The commitment is important, she added. “We have to build people up to build the future for our profession.”

By: Sheryl S. Jackson

5 questions to ask when selecting a lock company

A good lock on the door is a retailer’s first line of defense against loss. Whether you run a single-location boutique or an international brand, it may be best to engage the services of a lock and security provider.

Joey Dalessio, General Manager of Codelocks Inc., shares some tips on what you need to know before you hire a locks and lock systems supplier.

What are your needs?

There are still some retailers who just need someone to install physical hardware, but increasingly, lock systems are integrated with cameras, alarms and mobile devices. Do you need mechanical locks or a keyless electronic system? Do you want analytics that tell you if someone enters a space they normally wouldn’t have access to?

“Sometimes you’d need several companies to achieve that; sometimes you’d want to get that from a single source,” Dalessio said. “Typically today, chain stores are served by NSPs (National Service Providers.)”

Are they code-compliant?

The overlapping network of federal, regional and municipal regulations designed to protect public safety and welfare has changed the playing field for people who install and maintain lock and security systems. For example, the Americans with Disabilities Act (ADA) provides guidelines for automatic door-opening systems, which can cost several thousand dollars and are definitely not a DIY installation, Dalessio said. “It’s a job that needs to be done by someone who knows all the rules and is able to keep you in compliance.”

Are they certified?

Numerous institutions, ranging from technical schools to professional associations, offer various types of training and certification for locksmiths and security providers. Generally speaking, Dalessio said, “There’s not one organization I would recommend over another, but if someone is certified from ALOA, that matters.”

He is referring to the international trade association ALOA Security Professionals Inc. (formerly known as the Associated Locksmiths of America), which offers certification at six levels, beginning with AFL (ALOA Fundamental Locksmith) and moving up through increasingly senior levels of CRL (Certified Registered Locksmith); CPL (Certified Professional Locksmith); CML (Certified Master Locksmith); CPS (Certified Professional Safe Technician), and the highest designation of CMST (Certified Master Safe Technician).

Are they licensed?

This question is especially significant for businesses that operate in more than one state. “So many states have different laws,” Dalessio said. Although only about 15 states have licensing that specifically covers locksmithing, they all have regulations requiring licensing for low-voltage wiring, which relates to life safety.

“In many cases, you have to answer the standards set up by the NFPA (National Fire Protection Association).” Exit and egress doors must open in an emergency; locking them incorrectly can be life-threatening.

Are they insured?

It should go without saying, but a lock company should be able to produce proof of insurance ranging from $1 million to $5 million, “depending on the size of the job.”

Beyond these considerations, Dalessio said, the technology around locks and lock systems is changing fast, so “it would be good to have a company that was savvy enough to know what’s going on.” The right lock company won’t simply be the one that can fulfill the needs you have today; it will be the company that can anticipate and satisfy the needs you don’t yet realize you’ll have in the future.

By: Sarah B. Hood

The End of the World as We Know It. Apologies to R.E.M., but even though we may not (yet) feel fine, things are better. Attendees at PRSM2018 saw the improvement first hand. Just about every metric surrounding PRSM’s seminal event improved between 2017 and 2018.

Buck Up. Why then is there still so much public pessimism regarding physical retail? The easy story is to focus on the negative aspects of today’s retail. The real story (for those media adept enough to report on it) is that the revolution continues. That revolution, boiled down to its basics, is that the physical retail experience matters more than ever. Online retail is a method to shop if speed and a physical experience are not important. But, with the right experience, there are few retail purchases that are not enhanced by an in-person or in-store dynamic.

Overheard at PRSM2018’s Keynote. One of the most mesmerizing parts of Gary Vaynerchuck’s speeches is when he addresses tough times. To say that Gary relishes a challenge is a huge understatement. He goes so far as to (rubbing his hands together) chide the forces of business doom – asking out loud (with Gary … very loud!) to bring it on. Why would anybody wish that upon themselves? With Gary, it’s a combination of confidence and the rare ability to filter out negative feedback – or more accurately, to feed off negative feedback. Physical retail could benefit from this line of thinking.

What Customers Ask of Physical Retail. Clean, safe, efficient shopping experiences are now the ground floor of survival in today’s retail. Our customers are looking for more. The Internet is coldly clean, efficient and (depending upon content filters) safe. What online cannot replicate is the feel of a new product, the experience of trying that product out in a store, or the vibe of a multi-use shopping space where a customer can be sold to, fed and entertained within one city block, food hall or plaza. Retail has what customers are looking for – the ability to deliver a complete shopping and entertainment experience.

PRSM Association’s Role in the Revolution. As this retail revolution continues, your PRSM Association will continue to evolve as well. PRSM2018 attendees experienced some of those changes with our highly interactive exhibition floor, growing Retail Quick Connect opportunities, and relevant education and professional development sessions. Later this year, we will bring PRSM Association from PRSM-HQ (and our usual event lineup) to our members with increased local events and presence. These local efforts will expand upon our successful Retailer2Retailer Roundtables with the addition of energy seminars and other timely educational content.

2018 is Shaping Up as a Banner Year (Ignore the Doom and Gloom). In this issue of Retail Store Maintenance, you will see prime examples of our industry seizing this retail revolution opportunity. We’d love to see and hear your story as well – let PRSM Association know where you are, and we’ll be there!

By: Bill Yanek, PRSM CEO

Shopping malls and anchored centers are responding to customers’ changing tastes and shopping habits.

There are about 1,100 malls in the U.S. today, and one out of every four could be out of business by 2022, according to a July 2017 article in Time Magazine. Malls started having difficulties back in 2007, when the Great Recession hit; even after the economy recovered, many consumers never resumed their regular visits. In addition, the rise of online retail and changing demographics have transformed the way people shop.

Some malls have responded by altering their tenant mix; others are being torn down and replaced with mixed-use developments or converted into open-air town centers.

“These changes are very much driven by the needs of the local community,” said Stephanie Cegielski, Vice President, Public Relations, International Council of Shopping Centers. “If a community wants to keep their mall, it may get renovated or updated. If they’re not supporting their mall, they will likely support something else, and developers will go in and make those changes.”

Some empty big box stores that once anchored malls have become fitness centers, hotels or condos, with the main entrances facing outwards toward the parking lot.

“If the mall is well located, in a densely populated area with convenient access, but the mall itself is no longer relevant to the community it serves, you could see a conversion from an enclosed mall to an open-air shopping center,” said Haig Buchakjian, Executive Vice President, Brixmor, an open-air retail landlord. “In weaker locations, you could see conversions to other uses, including industrial, office, medical or residential.”

Providing the experience

It’s not only malls that are seeing the need to change, however. Open-air shopping centers anchored by grocery stores or larger retailers like Lowes or Home Depot are trying to adjust to a new retail reality as well. “There’s a lot of redevelopment happening,” Cegielski said. “They are really trying to adapt to the shift in their communities.” As baby boomers move out of neighborhoods and younger generations move in, retail centers want to attract tenants who can create unique, experiences geared to their customers’ preferences. Millennials, in particular, don’t want to dine or shop the same way that everyone else does.

Emphasizing experience provides a competitive advantage for malls and shopping centers. No matter how good Amazon and other online retailers are at getting products out to customers, they can’t deliver salon treatments, a night of bowling or laser tag, or a meal shared with friends at a favorite restaurant.

But shoppers today do want the convenience they get with online shopping, so retail centers are finding ways to assist their tenants who want to combine in-store pickup with online ordering. They can designate close-in parking spaces to speed the pickup process, or even provide a centralized spot where customers can pick up all of their online orders.

Customers also want to be able to shop in a clean, safe and well-maintained environment, said Eric Richter, Senior Vice President, Property Management, Phillips Edison & Company, which owns and operates leading grocery-anchored shopping centers. “We are enhancing and retrofitting lighting, we are improving landscaping and the exterior look of the shopping centers and adding amenities like bike racks and benches.” The company is installing electric vehicle charging stations in some locations to accommodate the growing number of customers who drive EVs.

Other sustainable upgrades like solar lighting retrofits and smart water irrigation controllers serve a double purpose; they can improve a center’s appearance and provide a good ROI for the retail center owner and its customers, Richter added.

Mixing it up

In addition to a new tenant mix, some malls and shopping centers are adding flex office space and residential units, including condos, on their property.

“If you have a one-story shopping center and you’re trying to figure out the best way to create cross-shopping, you could build residential units above the retail,” Richter suggested. “People like to have restaurants and grocery stores all within walking distance, and the closer you can get to your customer the better.”

Richter believes some current parking space could open up for new development as driverless cars and ride-sharing companies help change the way people travel.

“If you have a couple of acres that are open and don’t have a development scheduled right away, you can turn that into some kind of sports fields or an open space where people can let their dogs go,” he added. “As the trend for mixed-use lifestyle developments continues to bring the housing, shopping, office and recreational sectors together, it becomes even more practical to ensure the most strategic use of every square foot.”

Evolving role of FMs

Facilities managers will have to anticipate the new services they will be asked to provide as malls and retail centers move towards mixed-use properties and a more varied tenant population.

Cegielski said FMs may need to reconfigure space for different tenant types and provide infrastructure for more technology. With customers accustomed to online ordering, for example, brick-and-mortar stores may move toward a new look, with less merchandise on the floor but more space required for product storage in the back. Retailers might display an item for customers to examine or try out, then have a service clerk or automated system retrieve it from the back. Other retailers may want to install technology like automated clothing retrieval systems that allow customers to select, without leaving the dressing room, clothing styles and sizes they want to try on.

A one-size-fits-all approach to facilities management won’t work in this evolving environment.

“It is critically important for our property managers to know their markets,” Buchakjian said. “We’ve structured our organization to allow our property managers to spend more time on property, to spend more time in and out of tenant spaces, to get to know those tenants on a more personal level so that they can really understand what it is our tenants need and how can we serve them in the best possible way.

“This is a local business,” he added. “If we want to be the best operator in our business, we have to really understand our tenants and our customers, and that only happens from really being local.” 

Stephanie Cegielski
Haig Buchakjian
Eric Richter

CityCenterDC, a Washington, D.C., development by Hines, a Houston-based firm. Built on a 10-acre site downtown where a convention center used to be, the community now contains 216 upscale condos, 458 apartments, half a million square feet of office space, 330,000 square feet of retail, and a schedule of ongoing live events.

“There’s a lot of redevelopment happening. They are really trying to adapt to the shift in their communities.” Stephanie Cegielski

“We are enhancing and retrofitting lighting, we are improving landscaping and the exterior look of the shopping centers and adding amenities like bike racks and benches.”

eric richter

Five Trends in Retail Centers

1. More entertainment.People want an experience in a mall or shopping center they can’t order online – a meal with friends, a game of laser tag, a massage and manicure.

2. Improved experiences. To lure shoppers away from computers, retail centers are improving landscaping and adding amenities to create places where people want to congregate.

3. Fewer chain stores and restaurants. Millennials in particular are looking for local and unique experiences and goods.

4. People living and working onsite.Adding residential and offices (business and professional) to a retail center will increase foot traffic and put unused space to work.

5. Integration of online shopping with brick and mortar outlets.That could include special parking spaces or centralized locations to expedite merchandise pickups for customers who have ordered online.

By:  Mary Lou Jay

Technology and focus on customer experience is disrupting the industry.

There is no question that technology has changed the retail industry. As e-commerce has grown into multichannel retailing that creates a shopping experience over a variety of online and physical stores, the challenges for retail facility managers have also increased.

Stores incorporate more technology to provide a seamless experience for customers – the ability to browse through one channel, purchase on another and return merchandise via a different channel. Although some experts predicted the elimination of physical stores completely when technology began disrupting the retail industry, customers have demonstrated the need for some physical locations.

Although retail centers will remain a critical component for many retailers’ business plans, the centers will look different in coming years, said Garrick Brown, Cushman Wakefield’s Vice President of Retail Research, Americas. “Our shopping malls have developed very differently than malls in Europe,” he said. While shopping malls in the U.S. house pure retail stores with similar price points and merchandise, such as apparel, cosmetics and gift items, and price points, shopping malls in Europe contain a wide variety of stores that include all retailers selling at all price points, grocery stores and services such as dry cleaners. “Our retailers self-segregate so that there are neighborhood centers with the grocery and drug stores as well as services and lower cost apparel, malls with higher priced merchandise and other centers geared toward big box stores – a giant cousin of the neighborhood centers,” he explained.

“We are the only country that has approached retail this way, except for a few areas in Canada,” Brown said. This is changing as the need for physical retail space shrinks, he said. “We have 12 billion square feet of retail space in this country, and we need 10 percent of it to go away,” he said. “In the stock market, a 10 percent change is a correction, but in the retail industry, 10 percent is an apocalypse.”

What will this new reality look like?

“The weakest malls and shopping centers will disappear,” Brown said. “The remaining malls and centers will have to adapt and change their strategy.” He predicts that Class A malls will take on a luxury feel while Class B malls will have more discount retailers as well as service businesses. “Although some retailers are cutting back on physical locations, Ross has announced that they will open 100 new stores versus the 50 that they had previously announced.”

The next wave of innovative uses for malls is the addition of food halls that are a mix of artisan vendors offering specialty ingredients and prepared foods in a casual environment – similar to a farmers’ market with “stalls” for each retailer. “This appeals to millennials who want experiences and the current food culture that appreciates fresh, fast food,” Brown said.

The retail power centers that include retailers such as Target and Walmart will continue with some exceptions. “Some big-box centers will pivot towards becoming multi-use, adding multifamily residences, retail, entertainment and dining components to replace vacant retail,” he said. “These lifestyle centers will also include medical centers, hotels and office space to create traffic for retailers.” The lifestyle centers that have been trending upwards in recent years are very normal in other parts of the world, he added.

In addition to the type of center or mall in which stores are located, technology and consumer expectations will disrupt the interior design of stores, Brown predicted. “Everything will be about elevating the customer experience,” he explained.

Because customers hate standing in line, retailers will find ways to eliminate the cash register at the door. Amazon has already built one store in Seattle, Wash., that uses the customer’s Amazon account, a smartphone app and smart technology, such as computer vision, sensor fusion and deep learning to track merchandise selected by the customer and place it in a virtual cart. There are no checkout lines – the customer just walks out with the merchandise and receives a digital receipt for the items purchased through their Amazon account.

Although not all retailers will automate to the level Amazon Go automates, there are opportunities to use technology to improve efficiency and quality of service. “Retailers, such as fast food restaurants, will turn to automation and robots to handle low-level customer service interactions,” Brown said.

How can retail FMs prepare for changes?

Future retail stores that rely more on automation and new technology will require FMs to be familiar with the technology’s maintenance requirements as well as IT protocols for security and protection of customer information, Brown suggested.

The biggest challenge for retailers in any type of shopping center or mall will be the focus on customer experience, the addition of entertainment and events, and increased foot traffic, Brown forecasted. Knowing when peak times for crowds may be and scheduling maintenance around those times will be important.

Emerging changes in shopping centers, malls and mixed-use centers offer retailers ahead of the curve opportunities to position themselves for the future. “Retailers should understand that this is a slow-moving train that will take years to become the norm in retail,” Brown said.

Brown cautions FMs not to interpret the slow pace of change as a reason not to address changes in the company’s long term strategic plans. He referred to a quote by Bill Gates: “We always overestimate the change that will occur in the next two years and underestimate the change that will occur in the next ten. Don’t let yourself be lulled into inaction.”

By: Sheryl S. Jackson