Regional Department Stores Seek Breakthroughs In The Future To Seek Characteristic Development

According to the statistics of the China National Business Information Center, the number of retail sales of major retail enterprises in the whole country decreased by 0.1% over the first three quarters of 2014, and the negative growth of domestic retail sales has become the norm.

Nowadays, under the new consumption environment, whether traditional shopping malls join hands with shopping centers or try to develop shopping centers, these initiatives are becoming an effective means to actively combat the downturn.

According to the statistics of the China National Business Information Center, the number of retail sales of major retail enterprises in the whole country decreased by 0.1% over the first three quarters of 2014, and the negative growth of domestic retail sales has become the norm.

Under such circumstances, various regional department stores listed companies have taken various measures to break through. Recently, various regional department stores listed companies have been buying, and they have established or joined financial companies to make up for the main business downturn.

Acquisitions continue

In November 28th, Chongqing department store announced that it would buy 100% stake in Chongqing commercial Mdt InfoTech Ltd and Chongqing Commercial Electronic Sales Co., and the purchase price was set at 29 million 180 thousand yuan.

As we all know, the Chongqing business group is the largest shareholder of Chongqing department store, and its branches are the wholly-owned subsidiary of Chongqing business group. It is also known that the business department mainly deals with sales, including IT products, electronic products and so on. The main business of e-commerce is sales, including electronic products, electronic equipment, office equipment and so on. The two companies have established long-term strategic cooperative relations with Hewlett-Packard Co and become government designated buyers of HP's entire range of products.

In view of the resource advantages and policy support of the commerce and credit bureau, the Chongqing department store said that after acquiring the electronic business and e-commerce of the business community, it can form an integrated effect in the aspects of resource allocation, channel construction and system integration in the procurement of digital products, such as procurement of the digital products, so as to achieve economies of scale and further promote the long-term development of the company.

In this regard, Guotai Junan research report pointed out that after the acquisition, Chongqing department stores in the 3C supply chain procurement and other resource allocation, channel construction and system integration level is expected to form an integrated effect to achieve scale returns. Relying on the electronic business platform, the integration of hundreds of enterprises in supply chain and channel construction can make the whole channel spanformation more smoothly.

Recently, BBK also announced that the company received the approval of the China Securities Regulatory Commission on Approving the purchase of assets from BBK commercial chain Limited by Share Ltd to Zhong Yongli and other issues. After the completion of the spanaction, BBK will have more than 200 stores based on the location of its property, and its business scale is expected to reach 20 billion yuan. It will become the leading retail industry in two provinces of Hunan and Guangxi.

In May of this year, BBK announced that the company intends to purchase 100% of existing shareholders of Nancheng department store by issuing shares and paying cash.

BBK said that the implementation of the spanaction is aimed at implementing the company's "Great Southwest strategy", and achieving rapid expansion across the region through strong alliance. In a relatively short period of time, it will complete the network layout of the company in Guangxi, further expand the company's scale advantage, enhance the company's overall competitiveness, and further enhance the company's continued profitability.

Prior to this, BBK also formally implemented the "cloud monkey big platform" strategy. Wang Tian, the chairman of the cloud monkey conference, said: "the strategy of cloud monkey aims to build the country's first O2O local life service platform. By integrating city resources and localizing the supply chain, we can meet the needs of local consumers online and offline at low cost and high efficiency. The company hopes to succeed in Hunan and expand to Guangxi and Jiangxi in the second half of next year. And the completion of the acquisition of Nancheng department store, just for the implementation of the company's strategy of cloud monkey hit the front stop.

CITIC Securities analyst Zhao Xueqin believes that under the current weak consumer environment and new channel diversion pressure, China's retail industry shuffling integration will accelerate. After the completion of the M & a spanaction, the two sides show the scale effect in procurement, warehousing, logistics and management, and the efficiency of supply chain is improved in the medium and long term.

In addition, the Bank of China international research has reported that Nanjing's new 100 is expected to merge in the fourth quarter of the British company HighlandGroup mergers and acquisitions frequent movements, is expected to complete the issuance in 2015. Buy China World Trade Center center, Nanjing. Nanjing Xin Bai also announced in a series of announcements that it is actively promoting major asset restructuring.

　　 Establishment or participation in the stock market Finance company

At the end of November, BBK announced that the company intends to invest in the establishment of a small loan company with a registered capital of 300 million yuan, of which the company invested 225 million yuan in its own capital, accounting for 75% of its registered capital. The announcement also said that the name of the small loan company to be established is Changsha hi tech Zone BBK micro loan Co., Ltd.

BBK said that the establishment of this investment microfinance company is still in the preparatory stage, which requires approval from the relevant government departments, and will not have a significant impact on the company's financial performance and business performance in the short term. Small loan companies will set up professional management team and operate according to the mode of financial enterprises. At the same time, after the operation of the small loan company, the expected return of investment is relatively stable, which is conducive to the improvement of the company's profitability.

In this regard, Cui Yu, a consultant at China investment bank, told the China Daily News reporter: "for BBK, enterprises have local resources such as capital and connections. As a leading regional retail enterprise, enterprises are closely related to upstream and downstream suppliers. The purpose of establishing small loan companies is to meet the fast turnover needs of suppliers, while effectively configuring the company's capital resources. The company is more familiar with the suppliers who deal with each other everyday. Therefore, the establishment of small loan companies can quickly carry out business and guard against risks, which is conducive to improving the efficiency of corporate capital use, improving profitability and sustainable development.

"BBK realizes the supply chain finance through microfinance, on the one hand, provides financial support for its suppliers, and also gains new profits through small loan business." Chen Di Qiang, an analyst at Sai Di consultancy Research Center for strategic emerging industries, told the China Commercial Daily reporter.

In view of the establishment of BBK small loan company, Ping An Securities Research Report believes that BBK's deep understanding of the retail supply chain, the long-term relationship between upstream suppliers and the accumulated spanaction data are conducive to the identification and control of risks, and help to deepen the zero supply relationship. This is also the main reason for the retailers to enter the supply chain finance business under the market.

Prior to that, Chongqing department store also announced that it decided to invest 20 million yuan, and jointly invested with Chongqing agricultural and livestock products exchange and Chongqing business association to set up Chongqing heavy commercial factoring Co., Ltd. to develop business factoring business. The registered capital of the new company is 50 million yuan, and Chongqing department stores account for 40%, while the other two account for 30%.

On the same day, another announcement issued by Chongqing department store said that it was co sponsored with 6 companies to set up Chongqing Yuzhong District 100 hundred small loan limited liability company with a registered capital of 300 million yuan. Chongqing department store invested 150 million yuan, accounting for 50% of the shares. The contents of the announcement show that the other contributers are Chongqing Shanghai Bridge grain spanfer bank limited liability company, Chongqing public city one card limited liability company, Chongqing Jianghong construction company, Zhejiang merchants Xinye investment group, Chongqing Di mile technology, Chongqing dazzle color commerce, and the capital contribution ratio is between 5% and 10%.

In this regard, Chongqing department store said that the establishment of a small loan company is to enable companies to cut into the financial sector, through handling various microfinance, bills discounting and other financial services to better serve the company's main business and increase company revenue.

Earlier, the Hefei department store also announced that the company and its subsidiaries had also invested in small loan companies and accounted for 10% of their shares. It is understood that after the Hefei department store and Jingdong cooperate with the Jingdong open platform of "Anhui pavilion with Chinese characteristics" officially put into operation, the third quarter of this year added 20% equity interest in Xingtai small loan, the new prepaid business platform "long run payment" 35% equity interest, continued to exert power to the financial side. In addition, Hefei department store also owns 5.47% stake in Hefei science and technology, and 10% stake in Consumer Finance Companies, and 5% stake in rural credit cooperatives in Lu'an suburbs.

Chen Deqiang said in an interview with the China Daily News reporter: "today, the main business of department stores is sluggish, and the layout of the financial sector has been arranged, mainly dealing with the impact of the electricity supplier on traditional department stores. In addition, the high land price has also engulfed part of the profits. Its main business growth is weak or even shrinking, which is a major predicament and has to be spanformed. The trend of spanformation is mainly towards diversification and asset orientation, and complementation with traditional businesses.

"By the impact of the electricity supplier, the competitiveness of traditional department stores is declining, and at the same time, under the tremendous pressure of labor and rent, the spanformation of department stores needs to develop into modern shopping centers, increase entertainment, catering and leisure services, and develop into experiential consumption space." Cui Yu said.

　　 The future will be Characteristic Development

In recent years, most department stores have shown negative growth. According to the recent situation, regional department stores take more measures to break through than large department stores.

In this regard, Cui Yu believes that the regional department store has obvious advantages in the local area, and can play an advantage in policy preferences, human resources, logistics and product characteristics. Moreover, the regional department stores are small in scale and flexible in operation, so the spanformation and expansion speed is fast and decision-making is more rapid.

"Regional department stores have more difficult problems. Scale effect and brand influence are not as big as those of large department stores. Regional department stores can survive if they can be differentiated, but the department stores themselves are homogenized, so the days of regional department stores will be more and more difficult. Chen Deqiang said.

Chen Deqiang believes that if regional department stores can become more distinctive, they can not be replaced, seeking to be small, refined, unique, experiential services, and so on. Whether large department stores or regional department stores should break through the current dilemma by differentiation and refinement. "Differentiation and refinement are actually becoming more distinctive. Without cost advantages, we can only find a niche market through differentiation and refinement, so as to get development."

In December 1st, Fitch issued a rating agency report that China's department store industry will continue to face challenges in the next 12 to 18 months, not only because China's economic growth is slowing down and domestic demand is insufficient, but the increase in the number of department stores and the rise of other retail formats also aggravate competition. The report points out that the sales growth of China's department stores is lagging behind other retail channels, and the market share has dropped from 20.5% in 2005 to the current low double-digit. Recent sales trends show that the performance of department stores will continue to deviate from overall retail sales growth.

Fitch said that as the number of department stores increased, other retail modes such as shopping centers, stores and e-commerce entered the market, exacerbating the competition in the retail market. It is expected that with the withdrawal of the small and inefficient Department Stores operators, China's department stores will have a long market integration in the coming years.

In addition, Fitch expects that China's department stores will be in the next 12 to