5 Booming Retail Sectors for The Next 5 Years

With all of the challenges facing multiple brick and mortar businesses and eCommerce sectors, it’s hard to believe that anyone could succeed despite the lockdowns facing COVID-19.

However, these 5 booming retail sectors not only took advantage of a bad situation but also provided relief to those who needed to save money or prepare for a future post-pandemic.

1. eCommerce: Most Sectors who Provide Contactless Delivery

Multiple eCommerce sectors boomed during the pandemic, especially if physical stores opened online stores that offered delivery.

For example, Target’s eCommerce business became the seventh-largest in the US after they put more money into their online shopping experience.

In 2020, US eCommerce growth jumped 32.4%, which accelerated the shift to online shopping. 

Whether it was shopping for groceries or ordering same day flowers for our loved ones, ordering online became the preferred choice.

Out of all the sectors, food and beverage saw the highest growth at 58.5%, second to health, personal care, and beauty, which witnessed 32.4% growth. 

2. Discount Stores: Helping Lower-Income Families Buy Items

While many retailers have had to reduce their footprint during the pandemic, Dollar General, a prominent dollar store chain, plans to open 1,050 stores in 2021.

Americans who were still recovering from the 2008-2009 recession have used these stores to buy necessities, but they became even more important to families who lost their jobs and savings due to the pandemic.

As the minimum wage stays stagnant and inflation continues to rise, most Americans have little disposable income.

Coupled with the two recent economic disasters, discount stores have become a beacon of light for many, showing how wide the income disparity has become. 

3. Resale: Lower Incomes and Economic Risks Fuel this Sector

The resale sector is another example of the average American gets by during economic upheaval.

Many citizens have had to sell their clothes, jewelry, and furniture to get by, which caused the market to double from $24 billion in 2018 to $51 billion by 2023.

ECommerce apps, like Poshmark and Depop, have made it easier for everyone to sell their positions online.

Sustainability is also a reason why the market has expanded as fast as it has.

On the other hand, the influencer sphere has urged Millennials and Gen Zs to rotate their wardrobe constantly.

For many, reselling clothing found in thrift shops has become a lucrative side-hustle.

4. Home Improvement: More Time Means More DIY Projects

Consumers who used to spend most of their time out of the house, either to work, see relatives, or shop, are now spending their days at home.

Those who still have a job use the disposable income they would have spent on vacations to spruce up their dwellings.

As a result, sales at garden equipment or building materials stores went up 13.4% in 2020 and 40% in 2021.

DIY home improvements are becoming attractive to people who like to keep busy but can’t enjoy outdoor hobbies.

Cultivating a garden and building fences, sheds and decks are popular exterior projects, while interior projects like lighting, flooring, and painting also saw growth.

5. Home Fitness Equipment: Staying Fit While Gyms are Closed

Fitness lovers have avoided buying expensive equipment in the past because of the large upfront expense, but the pandemic forced these same people to buy a home gym.

Treadmills, stationary bikes, and free weight sales went up by 100-200%, and most of these purchases were for high-end equipment, like Peloton bikes and fully-stocked weight wracks. 

Multiple gyms started creating their own fitness apps to stay in business. These apps taught others how to use equipment and offered personal trainer and instructor-led classes for a fee.

This worked for many, as health and fitness apps saw a 47% increase in downloads from 2019.