Department Stores Are Coming Back To Endangered Species.

　 In 1995, a cover article in BusinessWeek declared that department stores were "coming back to endangered species". The author describes how American department stores are coming back in a surprising way after a heavy blow in the early 1990s. 10 years later, the Boston globe published the precarious department store, which declared that "the well-known mass shops have disappeared."

Even though Department store The news of extinction is exaggerated, but they all stress the problem that retailers have not been able to solve successfully for a long time. Over the past 20 years, changes in market dynamics and consumption trends have dealt a heavy blow to once prosperous and lucrative department stores. Over the past 8 years, sales of us department stores have lost $2 billion 500 million due to the emergence of large discount stores and specialty stores. Department store sales accounted for about 7% of total non vehicle retail sales from 11% in 1994 to about 7% in 2004, while retail sales per square foot continued to decline compared with other formats.

Losers are bound to succeed. In a relatively low-end market, large discount stores are the biggest winners. In the United States, WAL-MART and Taghit continue to attract value focused consumers; in Europe, this role is basically played by supermarket chains such as Carrefour. Over the past 1994-2004 years, sales of warehouses and supermarkets in North America increased from 3% to 8%.

Franchised stores also bear fruitful results. People are folding everyday. Buckle shop While shopping, it also goes to stores to find specialized products and services, such as Bath &Body Works and Williams-Sonoma in the United States, Zara in Spain and H&M in Sweden.

Which department stores and stores do not provide services? Can their success enlighten the once respected retail giants? In short, the answer is yes. A department store is a large shopping mall full of goods. In the eyes of consumers, goods here are usually expensive, lack of innovation, and knowledge of services and products.

Department stores should adopt many similar strategies used by competitors to reinvent and revitalize their businesses. For example, discount stores have entered the US $166 billion clothing market by targeting and catering to value focused consumers, which is the core business of department stores. In 1993, 6 of the top 10 clothing retail businesses in the United States were department stores, but by 2003, the number had dropped to 2. In the near future, as textile prices fall further, price competition will become more intense.

Meanwhile, franchised stores take large market share from department stores by targeting and catering to well-defined market segments, improving operations and improving efficiency. Many franchised stores have quite a few skills to provide the latest styles and use advanced inventory management systems to accelerate the speed of goods shelves.

　　 Department store If you want to survive, you need to learn from discount stores and specialty stores to improve your execution. This includes selling specific lifestyles, not just selling goods, improving supply chain efficiency, and diversifying development by developing new formats.

The driving force of change

There are many reasons why department stores are caught up in recent difficulties, many of which are external. For example, the demographic situation is changing. The baby boomers began to enter the aging stage. With a lot of disposable income, they not only increase the savings rate, but also turn to buying goods and services traditionally offered by department stores, such as health products, home decoration products and entertainment products.

The baby boom generation has entered the aging stage, but the younger generation of consumers did not continue the traditional shopping habits of the previous generation, but rather psychologically separated the old and outdated department stores. Today, young people shop in various forms, from online shopping to discount stores and niche commodity stores, such as Abercrombie & Fitch, all these formats can provide goods more quickly and react more quickly to the latest trend.

Over the past 10 years, consumer shopping has also undergone great changes. In the United States, storage member stores and supermarkets are replacing traditional department stores as shopping places for daily necessities. In addition, in today's era when customer attention turns to "power center", department stores are still stuck in shopping malls. In the "power center", space is controlled by stores, discount stores and category killers. For example, go to IKEA to buy furniture products, buy buy electronics products from best buy, and buy DIY home decoration products from home depot. Customers who shop in power centers believe that they can get more value with less expenditure and time.

The department store was once a lighthouse for shopping convenience, but now it has become a tedious and sometimes frustrating shopping place in the eyes of traditional customers.