Smartphones, fancy clothes, and groceries drove retailers to the top last year, according to a new report.
Sprouts Farmers Markets tops the list of the 2012 Hot 100 Retailers, according to Stores magazine, a publication of the National Retail Federation. The Phoenix-based grocery store saw a nearly 72-percent boost in its sales in 2011. Also within the top 10 are three smartphone sellers—Verizon Wireless, Apple, and AT&T Wireless—family-owned grocer Lowe's Market Place, high-end clothier Michael Kors, and athleticwear peddlers Lululemon Athletica and Under Armour.
The retailers at the top "cater to shoppers' desire for smaller-footprint organic supermarkets, high-end workout apparel and luxury accessories, and even online shopping," said Stores Media Editor Susan Reda in a release accompanying the report.
According to the publication, these were the 10 fastest-growing retailers in the U.S. in terms of domestic sales growth between 2010 and 2011.
|Retailer||Sales Growth (2010-2011)||U.S. Retail Sales (000)|
|Sprouts Farmers Markets||71.9%||$1,152,000|
|Michael Kors HOldings||65.4||$521,000|
|Lowe's Market Place||39.3||$975,000|
Source: National Retail Federation/Stores Magazine, August 2012.
The names at the top of the list are largely unsurprising, says Ken Perkins, president of retail industry analysis firm Retail Metrics. "I think these to me look similar to what we've been seeing coming out of the recession," he says.
For example, he says the apparel retailers near the top fill particular niches—like Lululemon, with its high-end yoga and running apparel.
That can make for highly loyal customer bases. These fast-growing clothiers "are among the best at creating true brand advocates who are willing to pay full retail prices and/or who have a business model that doesn't rely on discounts to drive traffic and appeal," said Mary Brett Whitfield, senior vice president of retail analysis firm Kantar Research, in a special report accompanying the figures.
Likewise, grocers that fit into the "natural" and organic niche, like Sprouts, have also shown recent strength, says Perkins. Perhaps the nation's best-known natural-food peddler, Whole Foods, posted strong growth last year, at 12.1 percent, putting it at No. 38 among the top 100.
"Those are the types of niche players in the food space that are growing rather rapidly, as upper-end and middle-income consumers are trying to eat healthier and moving into those types of retailers," says Perkins.
Still, there was growth among a range of grocers last year, from discount to high-end. Altogether, supermarkets accounted for nearly 20 of the 100 fastest-growing retailers in 2011, according to Stores.
Verizon Wireless, AT&T Wireless, and Apple likewise posted impressive sales bumps last year, which Reda calls "a clear indicator of how important smartphone devices have become." Apple was also boosted, no doubt, by its popular iPads and computers.
It's true that consumer interest and societal trends can boost a company to the top of the hot 100, but simple arithmetic can help, as Perkins points out. Five of the 10 fastest-growing retailers had U.S. sales of under $1 billion, while others had multi-billion dollar sales figures. That can make for a larger percentage bump for a smaller jump in sales.
This means that large stores showing sizable positive growth can still place lower in these rankings. Perkins points to Dollar General and Dollar Tree, which saw 13.6 and 12.5 percent sales growth, respectively, as examples. Discount stores like these have prospered in an economic downturn but aren't seeing the impressive 40 percent growth of retailers nearer to the top, like Lowe's Market Place, which had $975 million in total sales, compared to Dollar Tree's $6.5 million and Dollar General's $14.8 million.
Still, that doesn't mean that big sellers can't post booming growth. Amazon's $26.4 billion in sales last year was 42.5 percent larger than the year before. And with buzz about the retailer potentially considering same-day delivery, it appears the company may have an avenue to even more enormous growth.
Danielle Kurtzleben is a business and economics reporter for U.S. News & World Report. Connect with her on Twitter at @titonka or via E-mail at firstname.lastname@example.org.