Hard And Soft Aspects Of Physical Department Stores

Although we can not describe the current situation of China's retail real economy in the light of sadness and sadness, it should be more appropriate to have "mixed emotions" and "half the flame and half the sea water".

In the first half of 2015, China's main retail businesses closed 120 altogether.

But sales statistics also show that in 2014 alone, 150 key department stores and shopping centers sold 301 billion 800 million in total, and 24 single department stores and shopping centers entered "3 billion clubs".

The sales figures in 2015 are still waiting for a long time. What can be foreseen is that the representatives such as Beijing Xinguang Tiandi, Nanjing Deji, Shenzhen the Mixc, Beijing Xidan Yue Yue City, Guangzhou Tai Koo Hui, Chengdu Wangfujing and so on will have a good prospect.

What is the reason why the department stores are in a dilemma?

From the competitive environment, the growth rate of total retail sales of consumer goods has been slowing down, the competition of super saturated peers, the rising of new retail formats, and the development trend of the mainstream of e-commerce are the internal reasons for the overall weakness of the department stores.

According to the Ministry of Commerce monitoring statistics, since 2010, the total retail sales of consumer goods in China began to decline continuously, and the sales growth of key department stores declined more sharply, with only 3.7% in the first half of 2015.

The result of rapid replication is the excess quantity and the homogenization of "1000 stores side". In this sense, today's dilemma is that the whole industry is paying for the original craziness.

Followed by the "great leap forward" of shopping centers, Oteri J suddenly rose, and all kinds of specialized shops, stores and convenience stores started to spark a fire, causing serious consumption diversion.

Finally, it is the rise of electric business and the development of mainstreaming, so that the department store industry has been marginalized.

The electricity supplier not only snatch the cake of the department store, but also changes people's consumption habits and lifestyles. Many young people, even middle-aged and elderly, are keen on it.

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The impact of policy factors on department stores should not be underestimated.

A series of policies, high end consumption fell, and large group buying almost disappeared. The important weapon of the past expansion and sale of the department store, the prepaid card, issued several straight lines.

These are all factors that can not be resisted.

A series of anti-corruption new policies will help to squeeze in the long run.

The development bubble is conducive to the long-term healthy development of the whole industry.

It is the touchstone of the department store industry, but it should not be a natural excuse for decline.

Department stores

It has been nearly two centuries since its birth, and it has been in China for more than 100 years. Once the department store format was established, the era of mass retailing was announced with the open and clear price display and abundant commodity collection.

Many department stores in New China have evolved from the state-owned supply and marketing cooperatives during the founding of new China. They used to be monopolistic retail outlets in various places and had absolute right to speak for brands.

However, a commercial star who has been thriving for nearly two centuries has now fallen into a major strategic dilemma. "Traditional shopping malls will be withdrawn from the stage of history" has also led to the constant reflection and unremitting exploration of many industry scholars and practitioners. The lack of capacity in the department stores, inadequate service capabilities, and undigestible high cost are the most serious injuries recognized by industry researchers and business executives.

Nowadays, the rigid consumption demand is less and less, and the consumption of "capricious" and "watching mood" is increasing. However, most department stores have no proprietary goods, private brands, and lack of catering, entertainment, culture, leisure and other experience formats. The service facilities and service level also lag behind competitors with new business models.

The unchanging department store industry has already been disconnected with the modern consumption.

In general, department stores are still "shopping malls" which sell goods, and are still "two landlords".

At the same time, the cost of rent has been increasing, the manpower market has been soaring rapidly, and the marketing and operating expenses have been increasing year by year. These have become the last straw to overtake the camel.