Guangzhou's 2 Major Department Stores, Branch Stores, Local Business Overhang Crisis?

In May 13th, the largest department store in Guangzhou announced that the Xintang store in Xintang town of Zengcheng city was not as good as expected, and agreed to close the Xintang store.

Recently, another Guangzhou local department store, shinguang department store, confirmed to reporters that the South China store in shinguang department store in Foshan will be closed in May 31st.

According to reporters, the two stores were opened in 2010 and 2012 respectively. Huang Wenjie, executive director of Guangdong Circulation Industry Association, believes that from the two stores, although the opening period of shinguang department store is shorter, the retail industry's winter is beyond the expectation of the industry. We can not see any hope for the industry to recover.

Liu Hui, chief consultant of Zhao Yi Department store, told reporters that in the past two years, the impact of electric business and limited public consumption on department stores was particularly large. The cash flow of the department stores was out of balance, and the stores in the satellite cities of the first tier cities and the three tier cities were also hit first.

　　 department stores Busy arm stop stop

Although the responsible person of modern department store refused to disclose the specific operation of Xintang store in the interview with the daily economic news reporter, but the latest annual report released by the company, the performance pressure is not too small.

Financial data show that in 2013, modern department stores realized business income of 1 billion 69 million yuan, an increase of 8.54% over the same period last year. Net profit attributable to listed company shareholders was -2929 yuan, down 229.56% compared with the same period last year.

In the prospectus, the modern department stores also mentioned that the net profit of its head office accounted for more than half of the company's profits, and the revenue of the newly opened two stores was difficult to cover its main fixed cost in the short term.

Hu Liping, deputy general manager of Xinguang department store, said in an interview with "information times" that Xinguang department store was stationed in the new store in Nanhai Xintiandi, Foshan in 2012. After more than 1 years of market accumulation, its turnover has been close to 100 million yuan.

However, Liu Hui analysis shows that the daily turnover of 300 thousand yuan is already the life line of a small department store. On this basis, the annual turnover of 100 million yuan is "closed down according to the standards of foreign capital retail industry".

Liu Hui told reporters that some of the department stores will suffer a slight loss when the economy is good. Nowadays, under the impact of the electricity supplier and the contraction of three public consumption, the days will be even worse.

Liu Hui told reporters that the number of shopping cards purchased by cheque accounts for about 30% of the business volume of Jiangsu's several benchmark department stores. "It can be said that the impact of three public contracts on the department stores is very large."

"In addition, under the background of the whole industry downturn, many retail property also encountered problems in attracting investment. Because the agents were both squeezed by the upstream production enterprises and downstream department stores, fewer and fewer people wanted to be agents, and the investment in department stores was becoming more and more difficult. The agency's abandonment of investment has also led to massive blood pumping in the middle part of the department store industry, which has caused a great impact on the whole industry, especially the department stores in small and medium-sized places. "

Earlier, in May 14th, "daily economic news" reported that after closing the Ji'nan store, Parkson Department store will close the new North store in Changzhou, Jiangsu, around 20 this month. Liu Hui believes that Parkson closed 6 stores in 2, in fact, it gave the industry a signal. If the department stores could not support it, it must be closed. This is an iron rule in the retail industry.

Liu Hui said that although the department store industry has been a small profit operation, the continuous cash flow is enough to keep it going. In the winter of today's industry, more and more enterprises will have to break arm and stop their losses due to the imbalance of cash flow.

　　 Satellite city, three line city or closing shop tide

Reporters found that the modern department store and shinguang department stores are located in the three line cities. Liu Hui believes that this is related to the expansion of the department store industry in the past few years. "When I knew in 2005, there were 200 stores in the country which could be called department stores. After that, a large number of department stores in the county market came out." According to its data from the China general merchandise Association, there are about more than 1300 department stores nationwide.

He said that due to the fact that the speed of urbanization in our country is far behind the speed of urban construction, several satellite towns near Guangzhou have not formed enough industrial flow, stream of people and logistics, so the department stores must overestimate the speed of urbanization development.

　　 Wen Jie Huang "In addition to these two, other department stores will face greater market challenges, especially in the new territories, and the department stores that rely on leasing property will face more severe market challenges," he said.

Huang Wenjie said that fortunately, the pace of expansion of local department stores in Guangzhou was relatively slow in the last few years. If the expansion is fast enough, there will be more stores closing down in this market environment.

From the national market, Liu Hui There are two types of cities that will be hit first. One is the three line cities, especially the resource development cities, such as Datong, because such cities are very affected by the economic fluctuation cycle; the other is the industrial substitution cities, such as the cities with large export enterprises, and the enterprises transferring the factories to the central and western regions. If such industries are hollow and the floating population falls sharply, the consumption power will fall down.

Liu Hui told reporters that "if Guangdong's four tigers, such as Foshan, Dongguan and other cities, had large-scale industrial migration, they would have a very negative impact on the local department store industry. From a national perspective, the three tier cities may take the lead in ushering in a wave of closing stores.