California Centers

SEP 2018

California Centers Magazine serves retailers, developers, shopping center owners, investment sales brokers and tenant representation firms throughout the state of California.

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6 California Centers Magazine | September 2018 C C W hen you hear the words Five Below out of context it might initially evoke imag- es of a remote Arctic climate or unex- plored deep sea environment. But as the name of a fast growing chain of retail stores, these words have come to represent excitement, vibrancy and energy for scores of value seeking shoppers ranging in age from kids to grandparents. The first Five Below was opened in Wayne, Pennsylvania, in October 2002. Its tag line says much about the simplicity of the stores' appeal: Hot stuff. Cool prices. Five Below was co-founded by David Schlessinger, the creator and founder of Encore Books and Zany Brainy, and by Tom Vellios, former CEO of Zany Brainy. They've successfully tapped into an unmet market niche that has widespread ap- peal, and by ensuring that the stores' merchandise mix is ever-evolving, so- lidified Five Below's reputation as one of the fastest growing retailers in the country. In mid-2017, the store roster was comprised of just over 500 loca- tions operating. As of June 2018, the company had 658 stores in operation in 32 states, and projects opening ap- proximately 125 new locations in 2018 (33 of which were opened in the first quarter of fiscal 2018). Five Below has disclosed it anticipates California will become its biggest market, outpacing Texas and Pennsylvania. On entering the store, there are brightly colored shopping carts and baskets positioned conveniently near the entrance. And the fun begins in the very first aisle. The majority of the assortment of goods for sale at Five Below is intended to cater primarily to on-trend teens, pre-teens and their parents. Yet, on a recent mid-week vis- it to one of the recently opened stores, the majority of the shoppers were young moms and some grandparents, with youngsters and toddlers in tow, out on a fun summer's morning shop- ping excursion….with the average expenditure at checkout coming in around $55. The brightly lit interior is vibrant, colorful and exciting. Five Below's product offerings are grouped into eight in-store worlds: Style, Room, Sports, Tech, Crafts, Party, Candy and Now. The strategically displayed collections feature items from such leading brands as Lego, Wilson, Has- bro, Crayola, and Peeps. There is also licensed merchandise from quality, sought after names like Disney, and Marvel (themed after such popu- lar movies as Frozen, Avengers, and Star Wars). Balancing out the offer- ings is quality merchandise, in key categories, that is made exclusively for Five Below. In the fall, a big cus- tomer draw is "back to school," with several aisles having the basic items and supplies kids need to get ready for starting school, and all at very af- fordable price points. There is another section of floor space dedicated to a multitude of items ideal for outfitting a college dorm room, with a keen eye toward style and the latest popular tech trends. Among the remaining categories that encourage return visits to the store (where shoppers can "let go & have fun") are toys and games, beauty, blankets and pillows, candy, electron- ics (Bluetooth, cables, chargers etc.), fitness related, sports, and games. It is a bit like an ongoing treasure hunt, with each new shopping excursion re- vealing new items that can't be passed up. At Five Below its is easy to get the newest, coolest stuff, because every- thing is $5 or less. Among the season- Five Below anticipates that California will become its largest market. FIVE BELOW Makes Value Shopping Fun. Five Below's product offerings are grouped into eight different in-store worlds.

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