Why Did The Traditional Department Store Shutting Down The Storm?

Thirty years Hedong, thirty years Hexi.

Once in a limelight, there was no two.

Today, we are closing in.

Is it a comprehensive retreat or a desperate struggle? The situation of the department store industry, which has been reversed for ten years, has not only affected the industry's nerves, but also tortured the future of commercial real estate.

The Internet plus wave has swept the economy into a new normal. E-commerce has become popular, and the mainstream consumption pattern has changed dramatically. On the other hand, the continuous rise of rent and human resources cost the traditional retail industry, including general merchandise, to be overburdened.

No choice but to close shop

On the 27 day, a sunshine department store and BELLE square will be closed on August. The news spread on the Internet. Some media reporters visited the two shopping malls on the same day to find that although the customers did not shop much before the day, the shopping malls were still in the normal state of business, and the staff at the service desk also indicated that they had not received the closing notice.

Just a day later, sun department store issued a notice at 28 a.m. at ten a.m., and the mall will be closed in August 28th.

For Sunshine Department Store suddenly announced the closure of things, industry analysts believe that the primary reason is the lack of differentiated operations.

"At present, Qingdao's relatively popular shopping malls are in the form of" shopping mall ", which combines leisure, entertainment and shopping. Consumers are shopping while they are playing.

And sunshine continues to continue the "department store" model, compared with the surrounding commercial body, the lack of leisure experience content, the pattern is relatively single, the lack of its own characteristics.

Insiders analyzed.

Coincidentally, a few days ago, Huaihailu Road Pacific Department Store came out of the store news.

Under the impact of the Internet wave, traditional consumption patterns are being deconstructed, and the old department stores, once popular, are stepping into the crucial moment of life and death.

It is understood that in 1997, the Pacific department store opened in Huaihailu Road. It signed a 20 year contract with the Ruian group. Next year (2017), the contract is about to expire.

Obviously, in the case of the rising value of the downtown area, the current rental market in Huaihailu Road is no longer the same as it was 20 years ago. The sharp rise in rents is basically a matter of certainty.

As early as last March, Huaihai store in the Pacific Department reported news about property recovery and shopping malls closing.

In response, Liu Mengjie, general manager of Shanghai Xintiandi commercial company, said that after the expiration of the lease of Pacific department store, this part will be completed.

The area is reclaimed and operated by Xintiandi. "We will make it into a shopping mall with its own characteristics, youth, fashion and diversity. Although the hardware form is still a shopping center, the format will be more innovative so that it will become the gateway of the new world business circle."

For the desolation of traditional department stores, Liu Mengjie believes that it is the general trend. However, in her view, the pformation and innovation of real businesses should not only be based on experience, but eventually fall into the products of food, clothing and housing.

Encountered cold winter

In fact, the decline of Huaihailu Road Pacific department store is no accident, and signs of its decline have long been traceable.

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Previously, there were 9 stores in the Pacific department store, located in Shanghai, Chengdu, Tianjin, Wuxi, Chongqing, Dalian and so on.

In October 2013, the 20 year old shop in Chengdu Pacific department store closed because the lease expired, and there was a disagreement with the owners during the cooperation.

In addition, Tianjin store and Wuxi store closed shop last year for similar reasons.

If the Huaihailu Road store is closed next year, the department store operated by Shanghai in the name of "Pacific Department Store" will only have two shops, Xuhui store and sleepless city store.

The failure of Pacific department stores is a microcosm of the decline of traditional business entities.

In 2012, the first department store, which opened 19 years ago, was replaced by BMW flagship store. In 2013, two hundred Yongxin, which opened 20 years ago, was located in the global flagship store of UNIQLO. In 2014, Huating, the 15 year old shop, was replaced by Wan Dan city, a home appliance store.

Today, Wande city has withdrawn from the city, and replaced the brand new sunshine 527 shopping mall. However, it is still extremely cold and cheerless. Although the three and four floors are marked with various kinds of life food tenants, many of them are unmanned.

The four layer of the restaurant should be able to see only one digit number of people.

According to the statistics of China's general merchandise business association, the sales volume of 80 member enterprises increased by 9.3% in 2015, but the profit rate dropped by 19.53%.

According to statistics from the Internet of things, 114 stores were closed in 2015, including Martha, department store, Baisheng department store and far east department store.

2013-2017 years of Chinese department stores released by Shang Pu consulting

The analysis and investigation report shows that after nearly 10 years of rapid development, traditional department stores have welcomed the pformation period of industrial adjustment.

Traditional sales operation mode can no longer solve the problems faced by department stores nowadays.

In the future, if department stores can find new business models, department stores can compete with online stores.

Durbin, director of the service department of Rui Yide, said that in recent years, the average profitability of traditional department stores has been reduced by about 30%, a large part of which lies in the rise of electric business, and on the other hand, the homogenization of products. The brands in department stores are basically the same as those in shopping centers, and people prefer shopping in shopping centers to department stores.

Breakthrough in pformation

Facing the increasingly difficult living conditions, traditional department stores have to find new ways of development.

Shanghai Commercial Information Center released the relevant report, in the face of adverse market situation, Shanghai City department store to seek new breakthroughs in pformation and development.

Large department stores are developing in the direction of "big and all", gradually shopping centers, attracting customers and improving their performance through increasing entertainment experience formats such as eating, drinking, playing, and entertainment. Small department stores develop towards "small and fine" direction, relying on market segmentation and differentiation strategy, and pform into a specialty store with a dominant category or several related categories.

At the end of last year, Wangfujing department store removed the two word "department store" in its company name to show the firm determination of pformation, and announced the establishment of a shopping center company to enter the shopping center format with a new system of partnership.

According to the plan, in the next five years, the Wangfujing group will have 15 to 20 shopping centers with a single area of not less than 100 thousand square meters.

In addition, Oteri J is another important form of Wangfujing's efforts.

It is understood that the Parkson City Plaza is the first City Mall City Plaza jointly built by Parkson commercial group and Korean clothing and love group. The clothing and love group is the largest fashion circulation specialized enterprise in South Korea, and owns huge brand resources. This advantage brings together many Korean first-line brands and international discount stores, such as the popular cartoon paradise of Han Guochao COCOMONG PLAY GROUND, the first line luxury brand LUXURY GALLERY, and the fast fashion BACTORY brand.

Insiders revealed that before the pformation, the annual performance of Parkson's store was less than 400 million yuan. After the pformation, according to the existing performance of the Parkson City Plaza, it will be expected to reach 7-8 billion yuan or even higher annual performance granules, and it may become the first industry in the city in the next 1-2 years.

In order to widen revenue channels, the new world department store has expanded its proprietary business to life boutique, fashion apparel, catering and other areas. It has also developed joint venture catering projects and expanded the rental area of living facilities to increase sales and rental income of self owned goods.

In the first half of the fiscal year, the new world department store's self sales of goods amounted to HK $515 million, up 37% from HK $375 million in the same period of 2015, and the rental income increased 1.2% to HK $325 million from 321 million in the first half of 2015 fiscal year 2016.

According to the analysis of people in the industry, the reason why their business situation is not satisfactory is not that there is a problem in the mode of self-employed department stores, but whether the advantages of this model are combined with the local market and whether they are fully and effectively utilized.

According to the insiders, "the profit of department stores operated by proprietary products comes from the efficiency of inventory trading. Therefore, the precise grasp of the preferences of target customers, the flexibility of product adjustment, and the maintenance of customers are crucial factors.

Under the impact of the electricity supplier, the abundance of goods is no longer an advantage. The fast fashion of fast economy and fast culture is a huge competitor for the department store industry. If it can not be adjusted in time, it will affect the overall operation of the brand. "