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The annual Food Marketing Institute (FMI) “Facts About Store Development” study reports that the average size of a supermarket in the U.S. decreased to 34,000 feet in 2003, taking the size of new stores below 40,000 for the first time in 10 years – even as new store development was driven by target market-focused units catering to specific interests or demographics.

Overall, 12.6 percent of companies responding to the survey operated at least one target market-focused store. Of these, 44.4 percent offered gourmet formats and one-third each Hispanic-oriented or natural/organic formats.

The majority of these companies operate smaller chains of 11 to 100 stores. Similarly, 36.4 percent of the stores that these companies plan to open this year will be Hispanic formats, 45.5 will be natural/organic outlets and 18.2 percent will be gourmet ones.

New store construction went down for the fourth consecutive year, totaling 3.1 percent of all stores. Store remodeling tended to be the activity of choice by most food retail companies, with 4.9 percent of those surveyed remodeling at least some stores. The percentage of store closings remained fairly stable at 2.7 percent, compared with 2.5 percent the year before.

The report attributes the declining percentage of new store construction to a tough economy and a highly competitive business environment.

Survey respondents reported that close to 5 percent of the stores they represent underwent a major remodel in 2003, down slightly from 7 percent the year before.

The most popular features in new stores included deli departments, fresh seafood, floral/plant shops, prepared foods for take-out, ethnic foods, pharmacies and in-store bakeries. The fastest-growing features in new stores last year were dollar-item aisles/departments and self-checkout lanes, with almost one in five new stores featuring specialized low-price/dollar-item sections.
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