Why Store Refits Are Back on the Agenda
For years, new store openings were the ultimate symbol of retail growth. But in today’s environment of rising construction costs, supply chain disruptions, and mounting sustainability pressures, many retail leaders are rethinking their approach. Instead of focusing on greenfield projects, brands are looking inward — to their existing store portfolios — and asking: How do we make them future-proof?
The answer, increasingly, is refits and refurbishments. According to PwC’s Retail Outlook 2024, more than 70% of consumers still see physical stores as “essential” to their brand experience, despite the rapid growth of e-commerce. Refurbishment, then, is not a cosmetic upgrade but a strategic response: ensuring physical stores remain relevant, profitable, and sustainable.
The Business Case for Refits Over New Builds
1. Cost advantage
Global property advisor CBRE notes in its Global Retail Outlook 2024 that refurbishment is now the preferred route for many retailers. Rising construction and financing costs make new builds less attractive, while refurbishments leverage existing assets.
2. Faster ROI
McKinsey research highlights that refits typically achieve payback in 12–24 months, compared to 3–5 years for relocations or new builds. This shorter horizon makes refits a powerful lever for CFOs balancing growth and cost discipline.
3. Sustainability impact
JLL’s Retail Property Outlook 2024 estimates that refurbishing a store can cut 40–50% of CO₂ emissions compared to new construction. In an era of ambitious ESG commitments, refurbishment offers an immediate pathway to greener operations.
4. Flexibility and speed
Refits enable retailers to adapt quickly to changing formats — from smaller urban footprints to hybrid click-and-collect hubs. In a sector where consumer expectations shift rapidly, agility is a competitive advantage.
The Hidden Challenges in Store Refurbishment
Despite the advantages, refurbishment projects are far from risk-free. The biggest margin killer? Supply chain unpredictability.
McKinsey’s Supply Chain Risk Survey 2024 shows that 90% of companies report ongoing supply chain issues affecting capex projects. For refurbishments, these risks often include:
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Delayed fixtures and fittings pushing back opening dates.
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Global sourcing dependencies causing cost volatility.
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Blind spots in tier-2/3 suppliers, creating hidden bottlenecks.
Without a robust supply chain strategy, refurbishments can quickly shift from cost-saving initiatives to budget overruns.
Three Strategic Principles for Successful Refits
1. Treat refurbishment as a repeatable process, not one-off projects
Deloitte’s Global Retail Outlook 2024 emphasizes “portfolio optimization.” Leading retailers standardize design templates, supplier relationships, and logistics flows — making refurbishments scalable and repeatable.
2. Embed sustainability from day one
Refits should be designed with sustainability targets in mind. JLL notes that retailers embedding CO₂ and waste reduction into refurbishment projects achieve lower operating costs and stronger ESG performance.
3. Invest in supply chain visibility and collaboration
McKinsey data suggests companies using digital supply chain platforms cut disruption-related costs by 10–20%. For refits, that means fewer delays, more predictable timelines, and tighter cost control.
Reflection Questions for Retail Leaders
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How much of your store portfolio has been refreshed in the past three years?
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What is the financial impact when a refit is delayed by just two weeks?
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How much CO₂ could your brand save by refurbishing instead of building new?
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Is your supply chain resilient enough to support 20+ refurbishments in parallel?
Conclusion
Refurbishment is no longer just a matter of upgrading interiors. It is a strategic lever that combines cost efficiency, customer experience, sustainability, and supply chain resilience.
For construction managers and store development leaders, the challenge is to shift mindset: from seeing refurbishments as expenses to treating them as future-proofing investments.
Retailers who embrace refurbishment as a continuous, scalable process — powered by supply chain collaboration and sustainability goals — will not only reduce costs but also strengthen their brand, delight customers, and build resilience for the decade ahead.
The smart way to refit is not just about transforming a store. It’s about transforming the way retail organizations think about their entire footprint.
References
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Deloitte – Global Retail Outlook 2024
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PwC – Retail & Consumer Outlook 2024
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McKinsey – Supply Chain Risk Survey 2024
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CBRE – Global Retail Outlook 2024
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JLL – Retail Property Outlook 2024
