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For much of the last few decades it has appeared canonical that "bigger is better" in the physical size of retail stores. In practice, the grocery and general merchandise categories have seen tremendous increases in average store size. Academic literature points to many benefits of size. Advances in information technology and logistics, however, have provided a platform for a cost and quality competitive small store format. The viability and strategic functional choices of the small store, "convenience" strategy is explored. Introduction Service sector strategies involving facility size and location have changed drastically throughout this century. Prior to the widespread use of automobiles for shopping in the U.S., retail outlets such as grocers, banks, and general merchandise stores had to be physically close to the customer. The more primitive business practices than seen today also limited store size. Many service sector firms did not keep even rudimentary accounting records, the logistics of procuring a large variety of goods and coordinating deliveries was difficult, and assortment and inventory decisions were complex enough so that the average drug store stock turned an average of only three or four times a year in the 1920s (Strasser & Tedlow, 1994). Consequently, the additional complexity of increasing size could create diseconomies of scale. More recently, smaller numbers of ever-larger stores have been in vogue. For example, in the grocery industry the market leader in 1929 was AP Strasser & Tedlow, 1994), so average store size should continue to increase. This effect has not been limited to the grocery industry. The market leader in general merchandise, Wal-Mart, has seen average store size increase over 30% to 92,000 sq. ft. from 1990 to 1997, and is increasing the ratio of Supercenters which measure over 200,000 sq. ft. (Lee, 1998). In terms of number of outlets, however, Wal-Mart pales with prior market entities: Wal-Mart's 2,500 stores may seem ubiquitous, but the 16,000 U.S. stores in the American Druggist Syndicate in 1913 must have been on every street corner (Strasser & Tedlow, 1994). The strategy of large stores has extensive support in the academic literature, which will be reviewed in the next section. Our thesis, however, is that the combination of improved business practices, specifically the technical improvements in information systems and operational logistics and inventory advances, combined with increased consumer desires for convenience, has created an environment where networks of small stores can become a dominant paradigm once again. Certainly, a strategy of small stores focused on locational convenience has always been available, but with substantially higher costs and lower quality. A number of firms compete in that manner, such as Jacoby & Myers for legal services, HR a revamped Southland Corporation (expanding by 300-400 new 7-11 stores per year) (Lee, 1998), Edward D. Jones, a stockbrokerage headquartered in St. Louis with 4,570 offices in the U. …