In what’s nothing short of a dramatic, multiyear transformation, Burlington Stores Inc. continues to downsize stores to 25,000 gross square feet on average, from 80,000 to 100,000 square feet.
It’s happening simultaneously with the off-pricer’s aggressive agenda of opening new stores.
“It’s a big change and it’s working,” Michael O’Sullivan, chief executive officer of Burlington, told WWD in an exclusive interview. “Despite the fact that our stores are a third the size of what they used to be, they’re doing similar sales volumes, and on a sales-per-square-foot basis, we’ve seen a huge increase in productivity. So what the customer is saying is, they like that smaller format.”
He based that observation on hosting events at four stores — two each in the Philadelphia and the Miami markets during the weekend of Nov. 14 to 16, 2025, and the results from a research firm that conducted qualitative, in-store intercept interviews with shoppers at the four stores that weekend.
O’Sullivan said it is not unusual when an 80,000-square-foot Burlington store (they typically generate $10 million a year in sales volume) downsizes to 25,000 square feet either grows volume or doesn’t lose volume. That sounds magical, given the sharply reduced square footage and lower inventory level. But O’Sullivan said physical and operational advancements have enabled the smaller stores to maintain or exceed past sales volumes.
For one, selling floors have flexible fixtures so categories can be readily ramped up or down depending on sales trends or the season. The toy department gets ramped up in November, for example. Signage and lighting have been enhanced, and the merchandising is more organized. Also, receiving areas have been re-engineered for greater speed and efficiency so goods can get on selling floors faster. Checkouts through new technology are faster as well, he said. And last month, the New Jersey-based Burlington opened a 2 million-square-foot state-of-the-art distribution facility outside Savannah, Ga., enabling increased service speed in the Southeast region of the U.S. Burlington does not sell online, only through its stores. It uses its website to advertise deals, direct shoppers to its nearest locations, and provide information about the company.
“Our training programs, our field leadership programs, have really helped,” O’Sullivan added. “We have provided store managers with a lot more tools, processes, and reporting to really handle the smaller store format.” According to O’Sullivan, staffing levels have not changed due to the downsizings because they’re driven by the sales volume and the traffic of the store, not by the physical space.
He also suggested the Burlington buyers are doing a better job selecting merchandise. “We’re pushing for a faster turn so that forces the merchants to make sure they have the very best merchandise. Ten, 15 years ago, our stores tended to get very cluttered. We weren’t turning fast enough, and as a result, the merchandise wasn’t as fresh as we wanted. That’s all changed in our business,” O’Sullivan said, noting that since 2019, stores are operating with inventories down 35 percent.
“It’s very important that when the customer comes into the store, she sees new, fresh merchandise on brands, styles and categories. By having a smaller-format store with a faster turn, she should see a fresher assortment.”
O’Sullivan acknowledged that macroeconomic conditions and many Americans trading down in search of greater value have contributed to Burlington’s positive results. Last year, total sales grew 9 percent to $11.55 billion and comparable store sales increased 2 percent. Sales are projected to grow 10 percent in 2026. Net income in 2025 grew to $610.15 million, from $503.64 million in 2024.
Burlington — considered the nation’s third largest off-price retailer, after TJX Cos. and Ross Stores — offers an extensive selection of in-season, branded merchandise at up to 60 percent off, including women’s and men’s apparel in regular and special sizes, youth apparel, baby products, beauty, footwear, accessories, home, toys, gifts and cosmetics. In its “treasure hunt” for bargains, shoppers might find styles from Tommy Hilfiger, Gloria Vanderbilt, Adidas, Kenneth Cole, DKNY, Juicy Couture, and Karl Lagerfeld, among other well-known brands.
“When I joined Burlington in 2019 we had just over 700 stores. By the end of this year, we’ll have just over 1,300 stores, and by 2028, we’re expecting to have 1,500 stores and about 80 percent of those will be in the format we want, either by being downsized, relocated to a smaller site, or newly opened,” the CEO said. Larger Burlington stores in major urban downtown locations in many cases will not be downsized, he added.
Michael O’Sullivan
“It’s a lot easier to transform your store base when you’re opening more stores,” O’Sullivan said. “Every new store can be exactly what you want in terms of format and layout. We design it. We know the layout we want.” Many older Burlington stores are isolated from other retailers, whereas new Burlington stores are being situated in busy strip malls with lots of co-tenants, he observed.
More challenging is retrofitting an existing store, or relocating it to a smaller site. “It’s actually better for us just to close the store and move across the street or up the street, or to a better strip mall, or other location nearby. We’ve done quite a lot of that. Typically, every year we’ve relocated a couple of dozen stores, and by relocating we really mean within a mile or so from the existing location.”
Last year Burlington downsized 20 stores. “This year we will downsize about 30, and that number will grow” in the years ahead, O’Sullivan said. “We have a lot of that opportunity ahead of us in terms of further downsizing opportunities.” The strategy commenced two-and-a-half years ago.
“We say to the landlord we want to divide up the store, and depending upon the conditions of the lease, we either invite the landlord to take over that excess space and find a co-tenant, or we do it ourselves.
“We’ll put the capital into [building] a dividing wall and separating utilities, and then market that excess space to find a co-tenant. Those downsizing projects have a very strong return. Typically, we find that when we downsize the store, the sales actually get better, despite the fact we have less space, because we end up with an improved, better-looking store, and we also typically have a pretty good co-tenant next door that’s going to drive some additional traffic.”
Burlington prefers when discount groceries like Aldi or dollar stores like Five Below take the space. Almost all Burlington stores are leased. Burlington generally signs 10-year leases, with three five-year options.
“Everything we’re doing with our store base, the combination of new stores, relocations, and downsizes, it’s a complete transformation of our store base. We’re completely changing the physical experience of the store. We need to offer incredible value to the customer. Now we want to do that in an exciting, easier and more fun way to shop,” the CEO said.
A new Burlington storefront.
