What is a big box retailer?
A big-box retailer is a store with a large footprint that sells many products to customers. These companies reach economies of scale and pass along competitive prices to their customers.
A big-box store gets its name from the look of its building, typically square and plain. These retailers start at around 50,000 square feet, with many reaching 100,000 to 200,000 square feet. Most sell general merchandise, but some specialize in a single category, such as sporting equipment or tools.
The term big-box retailer has developed a negative connotation in many contexts. When one of these stores moves into an area, smaller, local stores often can’t compete and end up closing.
Retail operations software helps brick-and-mortar stores centralize and analyze their data. The software pulls data from point-of-sale (POS) systems and packages it into helpful insights about pricing, inventory, or use of retail space.
Types of big box retailers
Big-box retailers offer a wide array of choices to customers. The types of products they sell may vary, depending on the store type.
- General merchandise: These retailers function as a one-stop shop for customers, offering everything from paper towels to apparel to bicycles. When these stores also carry groceries, they are called hypermarkets or supercenters.
- Specialty stores: These stores specialize in a single product category. They may focus on ready-to-build furniture, outdoor goods, or home improvement. Customers turn to these retailers for products beyond the scope of a general merchandise store.
Basic elements of big box retailers
Big-box retailers are often part of a strip mall and sit near highways or interchanges for easy access by vehicle. Other essential elements of big box retailers include:
- Sprawling retail space. A typical big-box retailer is approximately 125,000 square feet. A supercenter, which offers groceries and general merchandise, can be over 250,000 sq. ft. For comparison, an average chain drugstore occupies 13,000 sq. ft.
- Chain affiliation. Most big-box stores are part of a larger retail chain. This connection allows them to negotiate better contracts with suppliers.
- Expansive parking lots. The parking lot of a big-box store is at least 1.5 times the size of the store itself – often larger.
- Basic design. A big-box retailer usually has an unremarkable, boxy exterior with few, if any, windows.
Benefits of big box retailers
Even though the term big-box retailer has developed a somewhat negative connotation, these stores are popular as they offer several benefits to shoppers, like:
- Low prices. Big box stores can lower their profit margins on individual items and focus on the volume of items sold. With this volume pricing and strong contract negotiation power, stores can offer customers substantial savings.
- Convenience. Many consumers find it convenient to shop at big-box retailers. These stores have a large footprint with many different departments to meet shoppers’ needs. At hypermarkets and supercenters, customers can purchase everything on their shopping list, from ingredients for dinner to a camping tent for their weekend trip.
- Selection. While a small grocery store may offer three or four brands to choose from for a particular product type, a big-box store has the space to stock a much larger variety.
- Familiarity. Since most big-box retailers are part of a chain, customers become familiar with their branding and product lines. Although the floor plan may vary from store to store, they can still have a similar shopping experience on vacation as they do at home.
Kelly Fiorini
Kelly Fiorini is a freelance writer for G2. After ten years as a teacher, Kelly now creates content for mostly B2B SaaS clients. In her free time, she’s usually reading, spilling coffee, walking her dogs, and trying to keep her plants alive. Kelly received her Bachelor of Arts in English from the University of Notre Dame and her Master of Arts in Teaching from the University of Louisville.
