Are 'big box' retailers the dinosaurs of shopping, left behind by evolution and facing extinction?

Are 'big box' retailers facing extinction? Key points: Most Big Box retailers are seeing sales growth on a per-square-metre basis lag increases in operating costs Smaller retailers emphasising service are performing better than the bigger players Online sales are forcing many big box retailers to cannibalise their sales According to a deep dive into their operational DNA by investment bank Morgan Stanley, these larger retailers could well go the way of the dinosaur. On Morgan Stanley's figures, drawn out of the February results season, only three of 22 big box retailers reported sales-per-square-metre growing faster than operational costs. "Soft sales-per-sqm growth for large box retailers will likely bite soon given 70-90 per cent of operating costs inflate at between 2.5 per cent and 3.5 per cent," Mr Kierath said. "Interestingly, Nielsen indicates that 50 per cent of online sales growth is cannibalised from stores and a further 40 per cent from competitor stores, which points to low sales incrementality," Morgan Stanley observed.