How Can We Break The Tide Of "Closing Shop Tides"?

Department stores want to reduce the number of shops and close some department stores that are unable to reverse losses in the short term, trying to ensure net profit. However, the department store industry is only a microcosm. In the context of the rising consumption pattern, the "closed shop tide" has become the sole key word of the domestic retail industry in 2015.

"The deep-seated contradictions accumulated behind the massive expansion of the department store industry in the past few years have not been highlighted, but the department store industry has entered a period of adjustment because of the slowdown in economic growth, the impact of emerging businesses such as electricity providers and the rising cost of their own businesses." Xia Lin, Deputy Secretary General of the Chinese Department Store Association, said that some shops were closed because of difficulties in their operation, and others were motivated by their own need for active transformation.

The reporter noted that from the analysis of the reasons for the change of interim performance, the companies whose net profits fell were mainly due to the slowdown in macro-economic growth, the impact of online retail sales, the increase in labor costs and the closing of loss shops.

For example, Xinhua's performance fell by 160.07% - 140.76%, mainly due to the macroeconomic weakness and the downturn in the industry boom during the reporting period; labor costs increased considerably; and some of the loss shops were closed. Hangzhou's first half performance fell 5.85%, mainly due to the diversion of e-commerce, intensified competition in the same industry, shopping malls and other factors. The China 100 Group expects net profit to drop by 77.92%, mainly due to the continued slowdown in macroeconomic growth, the weakness of the consumer market, and the weakness of terminal consumer demand.

In this regard, the industry analysts believe that Department store industry As a whole, the business capacity is declining, as labor costs and rental costs have been rising. Therefore, net profit decline is a commonality in the past few years, and it will be difficult to change in the future. Department store industry competitive power Continuous decline is an indisputable fact.

It is worth noting that at present, many department stores have seen a wide range of shop closes. In the first half of this year, China's main retail enterprises (including department stores and supermarkets) closed 121 in China. Department stores closed 25 stores, which exceeded the number of 23 stores closed last year. Among them, Wanda Department stores closed 10, Marsha's Department closed 5, Tianhong mall closed 3, Golden Eagle closed 2, far east department store, sunshine department store, Parkson Department Store There are 1 stores in Hua Tang shopping mall and Tianjin Le Hui Department store. The increasingly intense "closing shop tide" reflects the dilemma of domestic retail department stores.