Are We Wrong About Brick-And-Mortar Retail?

Behold the rare retailing IPO: Private-equity-backed home-improvement retailer Floor & Decor Holdings Inc. is expected to go public this week.It touts double-digit sales gains and a growth strategy centered around building hundreds of big-box, brick-and-mortar stores across the U.S. At a time when other retailers have halted openings or are shuttering stores to keep up with a shift to online sales, the IPO almost seems plucked from a different era. Take Floor & Decor’s much bigger competitor, The Home Depot Inc. After decades of aggressive new-store growth, Home Depot responded to the housing crisis by halting building plans, years before other retailers realized the potential liability of a larger footprint. Home Depot’s strategy of investing in e-commerce, supply chain and store improvements instead of new stores has worked well. Even now, after a housing recovery and low interest rates have helped Home Depot achieve seven straight years of sales gains — suggesting it could probably get away with building some more stores — the company line is clear: Make the most out of the current store base. Read more at Bloomberg.