Neighborhood Goods to open first physical store in November
Startup Neighborhood Goods, which calls itself a "modern alternative to — and evolution of — the department store," in November is opening its first physical store in Plano, Texas, a city about 20 miles north of Dallas, according to a company press release emailed to Retail Dive.
The new location, in Plano's 255-acre open-air shopping center Legacy West, will showcase a series of cult and pure play e-commerce brands, including sneaker marketplace Stadium Goods, direct-to-consumer home furnishings The Inside, UK pajama brand Desmond & Dempsey, online mattress brand Allswell, menswear from Buck Mason, Reese Witherspoon's Draper James, kids clothing Primary, men's wellness company hims, underwear and loungewear brand MeUndies and contact lens startup Hubble, among others.
Some brands, like fragrance company Otherland and framing e-retailer Framebridge, will provide elements for the store itself, according to the release. Cookware from Made In will be used in the retailer's restaurant, Prim & Proper, created in partnership with Front Burner Restaurants.
Neighborhood Goods resembles Story, the retail concept recently acquired by Macy's, as well as efforts like Simon Property Group's "The Edit" and GGP's "In Real Life," by tapping up-and-coming brands, including e-commerce pure plays.
The concept appears to have hit a nerve. When the company began curating brands for its Legacy West location it hoped to sign 10 to 15 companies, but that has expanded to as many as 35, Neighborhood Goods co-founder and CEO Matt Alexander said. "We believe it represents a resounding endorsement of the concept and the opportunity in the space," he said in a statement.
Several investors have also endorsed it. In May the company announced a $5.7 million seed round, according to a press release emailed to Retail Dive at the time.
Its potential can be gleaned from those efforts, which seem to be resonating with shoppers but remain unproven. Simon Property Group executives last month, for example, noted that their "The Edit" experiment is still a work in progress, but said they and the participating brands are pleased so far. "It does work as an incubator and we're seeing positive results out of it," Simon President and COO Rick Sokolov told analysts, according to a transcript from Seeking Alpha.
Neighborhood Goods may benefit from its location in a premium mall, which are faring much better than lesser locations, as much as from its concept. But what may be most curious about its positioning is the company's willingness to tie itself to the department store concept, considering the deterioration of that model.
That decline is leading malls to bring in unique tenants more likely to entice shoppers. More restaurants, entertainment and health clubs are popping up, for example. Neighborhood Goods, which is running a restaurant and has tapped wellness brands for its portfolio, seems to have taken the note.
"The department stores have really suffered, but department stores have been on the decline for 40 years," Michael Brown, partner in the retail practice of global strategy and management consultancy A.T. Kearney and author of the report "The Future of Shopping Centers," told Retail Dive in an interview. "And now the mall owners are bolstering that mall offering with attractions as opposed to anchors. We're just transforming the way space is used."
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