The latest implementation of a shifting retail strategy was the spark that ignited a fire under Verizon Communications (NYSE: VZ) stock on Thursday, sending the big telecom’s shares up by more than 2% on a day when the S&P 500 index only ticked up by 0.4%.

This move marked the latest development in Verizon’s ongoing efforts to adapt to the evolving retail landscape, a trend that has seen many major players in the industry adopt more flexible and efficient business models.

Franchises on the Rise

Verizon announced that it aims to sell 274 of its stores around the U.S., and cut roughly 500 corporate jobs as part of a broader restructuring program designed to streamline operations and reduce costs.

According to the company, the store transitions will affect around 3,000 of its retail and corporate employees, with many of the affected workers likely to be retained by the third-party entities that will operate the stores under franchise agreements.

Increasingly, Verizon’s retail outlets are being managed under the franchise model, with around 5,000 company stores currently run in this manner. Following the sale announced on Thursday, Verizon will directly operate only about 1,000 of its outlets.

This shift towards more flexible and efficient business models is part of a broader effort by Verizon to prepare for a future where artificial intelligence (AI) plays an increasingly significant role in customer service and other areas of the business.

In October, the company announced plans to cut roughly 15% of its workforce, or around 13,000 people, partly in anticipation of AI taking over certain functions. This is part of a broader corporate makeover that includes a recently introduced, simplified service plan for clients and a refreshed loyalty program.

While the prospect of job cuts is never heartening, the silver lining is that the current program could result in a genuinely leaner, more efficient Verizon if done well. Shareholders would currently welcome the return of solid growth for the company, but as it stands, it’s a reliable (if unspectacular) performer that pays a handsome, high-yield dividend (over 6%).

Verizon’s efforts to adapt to the changing retail landscape are a key part of its overall strategy to stay competitive in a rapidly evolving industry. By embracing more flexible and efficient business models, the company is positioning itself for success in a future where technology and innovation will play an increasingly significant role.