Full Scale Collapse Of Physical Retail And Small And Medium-Sized Cities

Oversupply is not just about Shenyang, it is not just big business shares that are under pressure.

After a long decline in the past few years, physical retail has turned red sea into a brutal second half.

Some have not yet been completed.

The company is experiencing a more serious "life and death disaster".

Even those giants who are already in pition have to face increasingly severe situations.

Red sea turns Blood Sea old retailer profits avalanche

DQ shares is an old brand in Northeast China.

The business has been spread over two or three lines of cities such as Dalian, Shenyang and Fushun, and has expanded to areas such as Henan and Shandong.

Profits fell more than 46% last year and operating income fell 4.27%.

The company said in its annual report that it will take various measures in 2016 to increase revenue by about 5%.

But so far, progress has not been smooth. In the first quarter of this year, the company's revenue fell 6.49% again.

The picture below is the chart of business income and net profit in recent years.

If we observe the change of business income of big business, we can see clearly that 2013 is an inflection point.

Prior to that, the company's revenue has gone through more than 10 years of growth, and profits fell last year.

Serious overcapacity and declining capacity in some cities are seen as the main reason for the drop in profits.

In analyzing Shenyang's commercial competitive environment, DQ shares said: Shenyang's commercial competition is extremely fierce, and there are many large shopping malls such as Zhongxing Shenyang commercial building, Shenyang Baisheng, Wanda Plaza, new world, Zhuo exhibition and so on, and serious supply exceeds demand.

The rapid economic slowdown in some parts of Northeast China has also given the big business a heavy blow, and Fushun is the representative.

In its annual report last year, DQ shares said: "Fushun is a resource exhausted city. Under the influence of the economic environment, the production and sales volume of local industries such as coal and petrochemical industry has declined more seriously, especially in steel mills and aluminum plants.

Full scale collapse of physical retail and small and medium-sized cities

The decline in profits of DQ shares is not a case. The main retail listed companies have encountered similar crises.

Nanjing based two companies, central shopping malls and Nanjing new hundred profits, also suffered a serious decline.

Last year, the central shopping center fell more than 70% in net profit, down by nearly 55% in the first quarter of this year. Nanjing's new 100 billion loss in the first quarter of this year exceeded 170 million.

The business of these two companies has already gone beyond Nanjing, and the business has been spread across many cities in Jiangsu, Anhui, Shandong, Henan and Hubei.

The situation in the southwest is also not optimistic.

Chengshang group's net profit fell more than 60% last year, and now it has been renamed maotie business.

As a result of asset restructuring, the number of shopping centres in the Chengdu area has increased over the same period last year, and profits and operating income are not comparable.

However, we found that in the first quarter of this year, the company's revenues declined from other cities in Sichuan province and other parts of the province.

Below is a screenshot of Mao Ye's commercial earnings report, where revenues from Nanchong and Zhuhai declined by more than 10%:

The same bad news continues in the first tier cities.

Even with the unique advantages of Shanghai Nanjing Road Pedestrian Street, the new world's revenues and profits continue to slide.

Last year, the company's net profit fell by nearly 7. In the first quarter of this year, it fell 67% again, and its operating income continued to decline slightly since 2013.

The new world is a microcosm of the commercial change of Nanjing road pedestrian street. Its sales account for about 1/4 of the total sales of Nanjing East Road Commercial Street, and the retail sales of single department stores in Shanghai have been second for ten consecutive years.

From the analysis and statistical data of listed companies' earnings, it can be seen clearly that the decline in revenue and avalanche of profits in large physical retail stores all over the country; one or two or three or four tier cities can not be spared.

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When the super oligopoly era comes, small players are speeding up.

Under the pressure of the pformation of the electricity supplier and consumption mode, the pformation and upgrading of the entity retailer has been "chanted" for many years.

But for many shopping malls, pformation may be just a beautiful illusion.

Chen Qizong, chairman of Hang Lung real estate, regarded as a commercial real estate expert, once expressed a view: "location, scale and design are the" genes "of shopping malls. Once the shopping malls are completed, they can not be changed.

Developers who ignore these elements have failed to open their stores.

This means that when the pformation of traditional retail shopping centers to large shopping centers is unavoidable, those incompetent shopping centres have long been hopeless, unless they completely withdraw from the industry and use the property for another purpose.

When the small players are out of the game, the era of super oligarchs will follow.

The relevant statistics in Shanghai have shown this trend: in 2015, there were more than 200 large commercial facilities in Shanghai, but the 10 shopping centers with annual revenues of more than 3 billion yuan accounted for 1/3 of the total revenue of Shanghai's shopping centers.

The accelerated expansion of Wanda has also proved this point.

According to the results, Wanda has opened 133 Wanda Plaza in 2015, and 26 new businesses in 2015. The total shopping area of the shopping center has reached 14 million 130 thousand square meters, up 23% from the end of 2014.

The situation is already so grim.

Huge amounts of construction are still in progress, and inventories are still piling up.

According to the data of the National Bureau of statistics, by the end of last year, the area of commercial business space for sale has increased by 4 million 580 thousand square meters.

In the past few years, commercial buildings, which are continuously completed in large quantities, will undoubtedly intensify competition.

The following is a survey of the sales area of commercial business premises in the past years: data from the bakery finance and economics side.

In the past 3 years, the annual sales of commercial business rooms are over 80 million square, and last year it is up to 92 million 520 thousand square, which has not yet calculated the huge stock.

Do all these commercial houses have the so-called commercial real estate genes? If not, does that mean that they have failed to start business yet?