What Does a Luggage Store at an Airport Say About Retail?

In retail real estate, a branch can occupy a storefront in a shopping mall or shrink to just a few square meters in the middle of an airport. For a brand, both count as a point of sale, even though they have little in common from a real estate perspective.

Clōe illustrates that difference. The Mexican handbag, luggage and accessories company has more than 50 locations in the country and, according to a SiiLA REsource analysis of 50 of them, nearly seven in 10 are in shopping malls, while virtually all of the rest are in airports.

While that mix makes sense for a company whose product catalog includes travel-related goods, its distribution—mostly in malls—allows the brand to reach consumers at different moments of consumption. At the airport, Clōe reaches consumers when some of its products have an immediate use, while at the shopping mall it competes for purchases that do not necessarily respond to that need and that it may even seek to encourage through discounts. The latter occurs at at least 11 of the locations analyzed, which operate as “factory stores” and are concentrated in Mexico’s Central and Bajío regions.

Despite this, the network analyzed has no clearly dominant region. Central Mexico, the Bajío, and the South account for nearly three-quarters of the locations, with none of these regions accounting for more than 30% on its own. The rest are spread mainly across the North, along with a few locations in eastern and western Mexico.

This matters because if Clōe were heavily concentrated in one region, its mix of malls, airports, and outlets could be interpreted as an adaptation to local market characteristics. But because it appears across much of the country, that mix takes on a different meaning, one in which geographic expansion does not require replicating the same type of retail space in every market.

That breaks the equivalence between network growth and footprint growth, since opening 10 additional points of sale does not necessarily require the equivalent space of 10 traditional stores if part of that expansion can take place through kiosks or other smaller formats. A chain can therefore expand its geographic reach faster than its square footage.

That same flexibility changes what an opening represents for the property owner, since adding a point of sale can mean anything from placing a kiosk in a common area to adding a new storefront to leasable retail space. In both cases, the chain gains a location, but the space the property allocates to it, the rent it can generate, and the physical commitment it entails are different.

That is precisely why counting openings can show how far a network extends, but not necessarily how much its demand for space grows. In that sense, measuring a retailer’s expansion requires distinguishing between commercial reach and real estate occupancy, since one indicates how far a brand extends and the other how much space it needs to do so.

In Clōe’s case, the coexistence of stores, kiosks, and airport locations shows how commercial reach and real estate occupancy can advance without necessarily doing so at the same pace. To follow developments in Mexico’s retail market, visit SiiLA Market Analytics or write to us at contacto@siila.com.mx.