Five Below Heats Up the Retail World

The days of the big box mega retailers are limited. The United States is in a financial crisis of epic proportions with no sign of relief in sight. Americans are living below the poverty line. One in seven to be exact falls into this group. Lay-offs and unemployment will continue to be a hot button issue of the years to come. Major retailers are scrambling to find a solution to the ever growing concern of sales.

Walmart is seeing declines for five straight quarters as its core customer fights financial ruin. Target is posting good returns, only because customers left Walmart to shop for inexpensive trendy chic. The Dollar stores are the biggest winners since the appeal is to the everyman. A dollar store doesn't care what the demographic; they have the items you are looking for at the lowest price.

A relatively new business is capitalizing on trends of the major retailers while favoring the everyman with its unique pricing structure. Five Below, a Philadelphia-based retailer is positioned to be the next big thing for financially strapped America. The concept is simple, market to the largest demographic at an affordable price. Five Below targets pre-teens as well as young adults. The pricing structure is basic, $1 to $5.

Having already opened 40 stores this year, Five Below is moving beyond its roots in the mid-Atlantic region to New York, the New England states, Ohio, as well as fast growing North Carolina. By the end of 2010, Five Below will have approximately 142 stores in those areas. Over 200 stores are planned by the end of 2011.

With such a narrow pricing structure, the offerings would appear to be limited. On the contrary, Five Below offers customers a wide variety of fashion accessories, games, sporting goods, room décor, crafting/school supplies, books, candy, electronic accessories, DVD's, and video games.

The initial responses from openings have been positive. Five Below has also secured investment capital from Advent International Corporation to assist in its growth potential. Advent International has $26 billion which it plans to further invest in retail, consumer-based products and other ventures since the early 1980's.

Big box retailers beware, Five Below has a mission. With a strategy such as low prices and targeted demographics, Five Below will succeed.