The retail segment in franchising is a diverse one, but regardless of what was being sold, most brands in the category experienced sales growth.
According to research in the Franchise Times Top 400, 24 out of 29 brands in the category saw sales increase, with five reporting declines. In total, the category generated $148.8 billion in sales.
Leading the charge in sales growth was Filta Group, a kitchen services concept, which had a 51.7 percent sales increase from $61 million in 2021 to $92 million in 2022. Experiencing the largest decline, meanwhile, was Learning Express Toys, with sales falling 32.9 percent from $133 million in 2021 to $89 million in 2022.
For some businesses, the sales decline had less to do with performance and was more related to economic forces. This was the case for Rent A Center, according to Vice President of Franchising G. Michael Landry.
Rent A Center Vice President of Franchising G. Michael Landry
Sales were down by 7.2 percent for the leasing service brand, declining from $2.4 million in 2021 to $2.3 million in 2022.
“It was a slightly lower year for total revenue,” Landry said. “We were coming off a really extraordinary 2021, we did exceptionally well. We deal with a credit-constrained consumer, and roughly 100 percent of our customers were getting stimulus dollars from COVID relief and they spent it with us. So, we were coming off a high. We’ve been comparing our performance to 2019 and we’re still a bit up from there.”
The pandemic impacted sales at other retailers, too. Sales grew at The Vitamin Shoppe by nearly 10 percent, increasing from $1.1 billion in 2021 to $1.2 billion in 2022. CEO Lee Wright said the brand’s clientele grew because more people are invested in their health.
“As COVID was ongoing, everyone was focused on buying items like zinc, vitamin C and other supplements as they thought about how they could stay healthy,” Wright said. “As the pandemic has receded, people are exercising again and we’ve been able to continue to grow our sales as our business shifted from people purchasing items for their health during the pandemic to a person wanting to live a fit lifestyle and get back in the gym.”
The Vitamin Shoppe CEO Lee Wright
In the clothing segment, resale brands found growth as well. The category was led by Uptown Cheapskate, with an increase in sales of 27.5 percent, from $96 million in 2021 to $122 million in 2022.
Plato’s Closet, ranked at No. 120 in the Top 400, had a 7.5 percent increase in sales, rising from $594 million in 2021 to $639 million in 2022.
Renae Gaudette, Plato’s Closet chief operating officer, called 2022 a “record year.”
“Our average unit sales set a record at $1.3 million and we opened our 500th location in Ontario,” Gaudette said. “More importantly, we’re in the sustainability field, and Plato’s Closet extended the life of 60 million items. That’s a number we’re extremely proud of.”
Gaudette said the brand has benefitted from social changes and a natural buffer against inflation.
Plato’s Closet Chief Operating Officer Renae Gaudette
“We continue to see a generational and maybe even a cultural shift in buying and selling used items,” Gaudette said. “With what’s going on in the economy right now, young adults and teens want value. Inflation, meanwhile, hasn’t played much of a role. Our brands are insulated on the inflation factor because of our focus on value.”
In terms of overall sales, despite a decline of 1.7 percent, 7-Eleven still came out on top with $93.5 billion in sales for 2022. Keeping its No. 2 ranking, the brand also increased its unit count from 78,413 to 84,061.
Other brands to make the top 10 in the rankings were Ace Hardware at No. 5 with $23.1 billion in sales, and Circle K at No. 9 with $16.8 billion. Ace Hardware’s sales grew by 3.4 percent while Circle K had a 10.7 percent sales boost.