International Tourists Continue To Reduce Sales Of Lafayette Department Stores In The First Half Of The Year By 6%

Galeries Lafayette, Lord Osman's flagship store

France Galeries Lafayette

In the first half of the year, sales of international tourists, especially Asian tourists, were also hard to avoid. The group hoped to speed up the opening of new stores in China and the Middle East in the next three years to expand overseas business to make up for domestic weakness.

Groupe Galeries Lafayette, chief executive officer of Department Store Department of department store, Department of Nicolas Houz, told reporters in Paris on Wednesday that the group is now consulting with local partners in China and the Middle East, and plans to add 5 new department stores in the two markets in the next 3 years.

In recent years, the group has opened branches in Berlin, Dubai, Jakarta and Beijing, and plans to enter Doha, Istanbul and Milan in the future.

Galeries Lafayette of Beijing, which is jointly owned by I.T Limited (0999.HK) of Hongkong fashion dress retailer, Nicolas Houz, said that its sales reached 100 million euros in the first half of the year, up 15% from the same period last year, exceeding the group target.

The income of Dubai stores and Berlin stores is similar to that of the same period last year, and the sales volume of Dubai stores is expected to exceed 100 million euros this year.

As for the group's overall medium-term income, a year-on-year decline of 5.9% was recorded, which declined from 1 billion 700 million euros in the same period last year to 1 billion 600 million euros, mainly affected by the number and sales of international tourists and flagship stores in Boulevard Haussmann Osman Avenue, Paris.

International tourists account for 50% of the total number of visitors, and the largest proportion of tourists in mainland China, followed by tourists from Taiwan and the United States.

In the past year, the terrorist attacks by the Islamic state in France have devastated the international tourists' desire to travel and shopping. The number of visitors to France this year has decreased by 8% compared with the same period last year.

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The number and purchase of international visitors to Galeries Lafayette's Boulevard Haussmann Osman Avenue flagship store fell by 15%. After the July 14th National Day of the French National Day, the situation in the summer and the back school season became worse and the consumption of international tourists fell to 20%.

But he said that France, Paris and Galeries Lafayette's flagship store at Osman Avenue are still the dream destinations for overseas travelers, especially Asians, so the Group believes they will always return.

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As for local demand, Nicolas Houz e pointed out that although the consumption of local people in the first half of the year in the store and other stores remained strong, it began to become weaker in August. In September, the weather began to keep warm and people still did not start buying new autumn and winter products.

Nicolas Houz e, CEO of Lafayette department store

Galeries Lafayette, the flagship store of Osman Avenue, will start business on Sunday in early 2017, and he expects to bring 8% additional sales. The store will also gradually upgrade its 5 year renovation plant from next year, so the group will sell beauty, accessories, newspapers, jewelry, sunglasses and personal hygiene products for the Chinese tour group in the 28 thousand square feet of sales space opposite to the store.

The flagship store in Champs Elysees will start next year and is expected to open in September 2018.

Nicolas Houz e points out that the store will sell fewer products, but will provide more.

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Groupe Galeries Lafayette, a department store in France, operates 56 department stores in France, together with department store BHV Marais and its own brand Louis Pion, Royal Quartz and Didier Gu.

In recent months, the group has also acquired the luxury resale platform Instantluxe.com and flash online retailer Bazarchic to strengthen the business of e-commerce, which is one of the strategies of its Ambition 2020 (2020 ambitions plan). The Group expects to increase the share of electricity supplier sales from 2% at the end of 2016 to 10% by 2020.

One of the group's other expansion priorities is the discount store network. By the end of 2017, France will have 10 discount department stores, but now there are only 3.

With the average annual investment of 150 million euros, Nicolas Houz said the group hopes to double its profits in 2020.