How Should Global Department Stores Stride Across Different Situations?

According to the world clothing shoes and hats net, Christmas. Shopping Just after the season, the global department store not only failed to usher in the gentle reindeer, but was forced to face the cold black swan. With the slow recovery of global economy and the continuous impact of online retailers, the department store industry is moving towards a more promising future.

Investors rush to escape

Deutsche Bank said in its latest report that investors are fleeing the department store industry.

Last Friday, Deutsche Bank released a report that the department store industry failed to overstock in the fourth quarter of last year, but its performance still disappointed investors. In the Christmas shopping season, business performance of major U.S. Department Stores declined sharply, and global investors were pulling out of department stores.

In the past traditional Christmas shopping season, the performance of department stores was disappointing. Karl, department store, the largest two department stores in the United States. Macy's Sales in November 2016 and December fell by more than 2%. The Deutsche Bank report also said the 6 American States, including the US eagle and AO Fei. clothing Retailers also failed to achieve their expected performance.

Deutsche Bank's performance in almost all the US Department stores was downgraded according to its poor performance in the shopping season. According to Deutsche Bank, with the gradual loss of passenger flow in department stores, the whole industry has lost the possibility of expansion and profitability because of structural problems. Investors have little hope of turning the whole department store industry into a profit this year.

Messi department store announced on the 4 th this month, because "customer consumption habits change", Messi department store performance was poor last year, but also lowered the 2017 sales expectations. The next day, Messi's department also announced that because of the competition of network operators, 68 entities will be turned off at the beginning of this year, and a total of 100 stores will be shut down in the future, which accounts for about 15% of the total number of stores. Meanwhile, Messi's department store also plans to cut 10 thousand jobs.

In addition, the main competitors of Messi's department store, such as Sears's department store and Penny's department store, have closed some stores in recent years. The closure of department stores has also affected the profits of many stores. Howard Davidowitz, President of the retail consultancy and investment bank David deezi Association, believes that once a department store like Messi stores closes, businesses will find it difficult to find a new store. In the face of the pressure from the mid size shopping mall, it is difficult for young department stores to develop.

Messi, department store CEO, acknowledged in the announcement that the poor performance of the company during the shopping season reflected the difficulties faced by the whole department store industry. It can be seen that online retailers continue to earn money in the context of the declining popularity of the department stores. A few days ago, Amazon announced that it had created the best shopping season performance in the history of the company, and the Internet business shares rose collectively.

Online shopping is becoming mainstream

Not only is the department store industry in the United States experiencing a cold Christmas season, it is also difficult for European department stores to get warm.

Affected by the devaluation of the pound and rising inflation expectations, the British people spend more money on the Christmas season this year, and tend to spend less and choose more online shopping. Data show that British families spend an average of 780.28 pounds this Christmas, the lowest since 2012. But at the same time, the proportion of online shopping increased from 25% last year to 41%.

In the last week before Christmas, the sales of British John Lewis department store increased by only 0.4% over the same period last year. Data from the British Industrial Federation (CBI) show that retailers will still look down on UK consumption this year and plan to cut back on the volume of purchases due to inflation expectations from "off Europe".

James Kabouttly, an economist at Holland International Group, believes that the sharp depreciation of the pound has led to an increase in inflation expectations and an advance in household spending, which may explain why consumption will grow centrally before the Christmas season.

On the European continent, the department stores in Germany and France are very different.

Affected by the economic downturn and threat of terrorist attacks, last year Christmas consumption in France was also cold. According to statistics from research institutions, Christmas consumption in France last year was estimated at 67 billion euros, a slight increase of 1.5% over the same period last year. According to the estimates of market research institutions, the average household expenditure per household during the holiday season is 559 euros, and the overall consumption level is low. In addition, French people tend to buy discounted goods, and Christmas holidays are also very cautious. Data show that 70% of Frenchmen will track the price of goods on the electronic business platform, and buy the cheapest goods after three goods.

However, unlike Germany and France, the steady economic recovery obviously promoted the steady growth of consumption in the Christmas season last year. According to statistics from industry associations, sales volume of German retailers in the last 11-12 months of Christmas season is expected to exceed 90 billion euros, up 3.9% over the same period last year. Among them, sales in December were expected to exceed 50 billion euros, a record high.

Meanwhile, the Ifo business confidence index, known as the "German economic barometer", rose to its highest level in nearly 3 years last December. The German economist at the iffer Institute, which is responsible for the index, said that the German companies surveyed increased their satisfaction with the business situation and were more optimistic about the first half of 2017.

In addition, German consumers are confident of this year, despite the adverse effects of the US general election, Britain's "off Europe", Italy's failure in reform and terrorist attacks. According to a report released by the German authoritative market consultancy Czechoslovakia at the end of last month, the German consumer confidence index continued to rise slightly in January 2017. The German central bank said recently that the German economy is still in a stable recovery period. Active domestic demand is the main economic pillar, but many uncertain factors may lead to a slowdown in Germany's economic growth this year.

The black swan is still flying.

It can be seen that in the past year of the black swan in the global economy, the physical retail industry became the first "middle gun" to fall.

"Retail industry is the most direct response to good and bad economy. When consumers have more money, they can impulse buying many commodities, but consumers will tend to be conservative when consumers spend less money, so consumers' interest in department stores is also weakened." A veteran in the industry told the Beijing Commercial Daily reporter.

In addition, in view of the strong development of the electricity supplier, Guo Zengli, director of the China shopping center industry information center, told the Beijing Commercial Daily reporter that the development of the Internet accelerated the spanformation of people's consumption patterns. Under such a background, a single big cargo industry in the past was suffering from an unprecedented setback. Under the consolidation of the model, the upgrading and optimization speed of the department store industry failed to keep pace with the trend, and thus became more and more passive. This kind of fatigue was not only manifested in the department store industry, but also reflected in many formats.

At the same time, the risks facing the global economy this year may not be less than that of last year. Analysts pointed out that at present, the global investors are closely watching several major risks, including the policy trend of the US President-elect Trump after taking office, and the British claim that the "off Europe" roadmap, which will be launched in March, will be held in Germany, France and other European countries after a few months. These uncertainties will become a factor hindering the development of the department store industry.

"If we want to change the current situation of being pressed by the electricity supplier, the entity department store can do it on the one hand, breaking the inherent business mode and speeding up the optimization of commodities. On the other hand, it is changing the idea of keeping a close watch on commodities, and combining material with spiritual products." Guo Zengli said.

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