That's Something In The Mall.

When the main business profits reach a certain level, enterprises tend to infiltrate into other formats.

If a friend asks you to help Su Ning buy a box of instant noodles and go to Huarun to buy a bottle of good wine, don't you wonder, "are you kidding me?" or you will be OUT! Because the two major business tycoons have recently had new developments.

Suing, most people would think that they sell TV, air conditioning, fridge and so on. household electrical appliances Products, their business scope is nothing more than all kinds of household appliances. However, reporters found that some Suning Appliance stores in Xi'an began selling products such as mother and baby products, stationery, outdoor products, automotive supplies and so on. On Suning's official shopping website, suning.com, the reporter saw that apart from selling all kinds of household electrical appliances, the Department also opened a department store for daily use, which includes all aspects of life.

"The appliance retailing industry has already entered the era of meager profits. The expansion of simple appliance stores is not enough to support rapid development, and we need to find opportunities for expansion of other formats." Industry experts believe that professional home appliance stores are involved in department stores and supermarkets to expand professional home appliance stores. This "cross line" business phenomenon is mainly due to fierce competition from many industries such as peers, supermarkets, shopping centers and franchised stores, and has embarked on the road of expansion, reorganization and integration.

In the eyes of consumers, Huarun is a large supermarket operator, but in August this year, it opened a high-end supermarket OLE, high-end Jewellery Art, Voi_la cellar and so on in Guangzhou. High-end Supermarket sub card Blt and personal care retail store VivoPlus. At this point, roughly estimated, Huarun Wan's current operation format almost close to 15.

　 Low profit and "disoriented"

Recently, the China Chain Store Association released a research report on the financial situation of China's retail enterprises in 2010. Last year, the retail business revenue grew 20% year on year, while the profit rate of domestic retail business declined by 15%, due to factors such as rents and other cost increases.

In the case of operating costs such as property rents soaring, due to the widespread adoption of the Ying Mo Operation, even domestic high-quality department store brand, its operating net profit is generally not high. Liu Hui, a business consultant, said that compared with the real estate developers, the department store, which was rather "hard", actually earned only a small portion of its profits, and most of the proceeds were attributed to the property owners.

A few days ago, the China Chain Store Association and PWC's latest research report on the financial situation of China's retail enterprises showed that the current continuous inflation, the blow to consumer confidence and the investment driven economic structure had not fundamentally changed, which directly hit the retail enterprises in China. The profit margins of retail enterprises decreased significantly. More than 50% of the retail enterprises did not return to the level before the international financial crisis in 2008, said.

The department store seems to be tired of the "wedding dress" for the owners of the project. In addition to Wangfujing, Beijing's other one hundred brand, Cui Wei, opened a high-end shopping center as early as last June. Beijing Hualian has also transformed the shopping mall as an opportunity to enhance its profit margins. In April last year, it invested 220 million yuan to set up a main shopping center project development company. And the new world department store said that within 5 years, the brand's K11 shopping center will be landing in Beijing, Shanghai and Guangzhou. Intime department store also announced plans to open 100 shopping centers in the future, and its shopping center in the southern Dahongmen region will open at the end of the year. {page_break}

In fact, in Beijing, the high-end department stores such as Yansha, Chait, Parkson and other high-end department stores have begun to run their own boutique supermarkets. Yintai Department has entered the supermarket business gateway by purchasing more than 30 new supermarket chains, Suizhou New Century Shopping Center in Hubei province. In Wuhan, Zhongbei and Wu merchants have been known for their life theaters and super life houses. After these two department stores, Wuhan Zhongshang group also opened up high-end supermarkets. In Guangzhou, in addition to the first young fashion department store GBF format that has been set foot in the market, this year, Guang Bai also operates independent supermarkets and Guang Bai appliances.

With the increasing competition in department stores, when mining profits to a certain extent, the main business will tend to "infiltrate" into other formats and embark on a diversified development path.

　　 Cross-border may be more difficult.

Many department stores that have abundant cash flow hope that by transforming the shopping center, while reducing operational risks, they can also make up for the low profit bottleneck of department stores.

According to the analysis of the industry, cross boundary business involving areas outside the main business is an important way for business enterprises to tap new profit growth points in the process of intensified competition in the retail sector. New brands from cross industry enterprises will become a new competitive force.

"Single format to multi format development has become a trend for the future survival and development of the retail industry". Experts say that to a certain extent, this multi format business model set up a small shopping center, which brings more popularity to the store, and is conducive to better integration between the main store and other professional stores.

"Supermarkets under department stores should be viewed from a long-term and global perspective. As a structural part of the shopping mall, supermarkets can drive passenger flow, clothing department stores can increase gross profit, and help other large categories of commodities enhance their market share. Finally, we will use the commodity structure of supermarkets to drive the overall passenger flow. Industry analysts believe that the majority of department stores in the supermarket is actually to increase passenger flow.

However, although the department stores have opened supermarket stores, they are facing "happiness trouble" in the actual operation. Compared with the profits made by department stores, most supermarkets sell mainly consumer goods, which makes the supermarkets more expensive, but the profits are lower.

Moreover, the difficulty of high-end supermarket operation is first reflected in the cost is twice higher than the mass market. Moreover, unlike the ordinary hypermarkets, the mode of joint operation is mostly adopted. The imported goods of the boutique supermarkets are mainly self operated. The channel merchants buy the goods from the agents, and are responsible for the purchase, sale and storage links, and assume the corresponding operational risks.

For department stores that have been accustomed to joint operation mode, the difficulty of supermarket self operation may be even greater. If the department store supermarket can not highlight its characteristics, the combination of the flow of supermarkets and department store marketing will bring about a bad prospect.

Industry analysts believe that the biggest advantage of department stores: brand and grade. Department stores should work hard on the commodity structure and brand concentration degree of supermarkets, so that the overall positioning of department stores and the positioning of supermarkets can suppress competitors. At the same time, the department stores should increase the correlation between other commodity categories and supermarket products, for example, in the promotion, the various departments should be linked together, and all kinds of commodities will interact with each other.