In view of challenges facing shopping centers, there are several factors noted in contribution of intense and competitive environment within which shopping center managers operate. Some of these factors include overcapacity of shopping center and retail space, overlapping of merchandise offerings by different retailer formats and changing consumer lifestyle. In addition, modernization and evolution of technology also affects market share of this industry. It is currently subjected to new competitive threats from non-traditional sources such as the internet and other mode of non-store shopping. There were researches made that shoppers are finding that they do not have the luxury to spend time shopping or malling the as they once did. As a result, they go for the faster and most convenient way of shopping such as online shopping or home-TV shopping.

In these instances, it is best to strategize and address on the risks of decrease in market share caused by these factors. There must be major renovation and revitalization efforts to maintain a competitive edge in light of new competition. The industry must continuously reinvent itself through new innovations and concepts. Consumer-relations must be strengthened to motivate shoppers in patronizing their products and services offered. Some of the existing connections can be dial-in service, kiosks, product and store information, customer queries, advertising public relations, transactions, market research, preferred buyer clubs, contests, and personal shopping services. In most cases, electronic marketing can reinforce these connections allowing traditional retailers to protect and expand market share.

In assessing the feasibility and potential profitability of shopping center industry, analysts use trend analysis, efficiency analysis, regression analysis to identify historical patterns in the economic concentration, efficiency, and performance of shopping centers and retailers.

Profitability speaking, profit growth of mall retailers has...

For fiscal year, mall retailers enjoyed an after-tax profit increase of 50.3% over 2002, a remarkable performance if one takes into account that the first four months of the year were consumed by the lead-up to, and prosecution of, a major war.
Two operating metrics, occupancy and rental growth, are some of the keys to evaluating the health of the sector. Historical record showed that growth in profitability of shopping malls is consistent and still marketable. Mall occupancy has powered from strength to strength over the past several years, notwithstanding the seasonal peak that occurs, and is now at high level. Putting all foregoing analysis together, mall retailer profitability, demand for space, constrained new supply and continuing consumer enthusiasm for products and merchandise offered shopping malls have and still looked up by the market as an excellent investment.

Looking at the long-term outlook of this industry, as long as there is a ready market and business is flexible enough to adapt to change, stability and growth in a long-term sense can be achieved. Sales performance of shopping center is improving over the past years as the overall spending environment has improved and retailers have began to seriously implement new strategies to strengthen their competitive positioning and performance.

Bibliography:

DeLisle, James. "The Evolution of Shopping Center Research: A 12-Year Retrospective." 2005.

May 10, 2007. http://www.reuw.washington.edu/JSCR/2005Articles/JSCRV12

_2A1Retrospective.pdf

Hazel, Debra. "Brave New Format. Lifestyle centers look good, but are they earning their keep?"

2006. ICSC. May 10, 2007. http://www.icsc.org

"The Facts on Regional Malls and What They Say About the Vitality of the Concept.." 2005.

ICSC. May 10, 2007. http://www.azcentral.com/community/gilbert/articles/1014cr-mall1014Z12.html (pdf)