Mass Merchants and Wholesale Clubs Feel General Retail Pressures

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NEW YORK—Most notable among the mass merchants involved in optical, there was significant sales growth at Target Optical, which opened only two new stores but saw sales rise by more than 15 percent for the 2018 calendar year. Costco also had a solid growth year, with 12 new stores and a sales increase.

However, much of the optical retail business from other mass merchants and wholesale clubs was pressured in 2018, VM’s Top 50 U.S. Retailers Report illustrates.

Larger “host” stores felt the pressure of the general retail market where the number of general merchandise stores were winnowed back as consumers’ interest in online purchasing as well as “new” types of retailing for brands in the value sector took hold. As a result, most other optical departments inside mass merchants hosts were pinched.

There were 60 fewer optical departments within mass merchants and clubs overall for the year, but sales collectively for those businesses on this list, rose slightly, about 2 percent, according to VM’s estimates.

Shopko’s optical operation, it should be noted, survived the general merchandise retailer’s Chapter 11 filing and, as of this month, some 80 freestanding optical stores will continue to operate.

Sam’s Club brought in a new management team for its optical group as part of a health and wellness initiative, similar to the new team put into place at Walmart’s optical centers, refocusing their business. BJ’s operations in 2019 have moved from the Refac U.S. Vision group to BJ’s directly taking them over, effective January.

Still, mass merchants and clubs with optical departments are approaching 10 percent of the total U.S. optical retail market and are edging toward 25 percent of the estimated sales of the VM Top 50.

maxelrad@jobson.com