China's Department Store Industry Embarked On A New Rhythm Of Pformation

According to the world clothing shoes and hats net, in 2016, China

The industry continues to slow down, showing many new characteristics.

Chu Xiuqi, President of the Chinese general merchandise business association, thinks that the development of department stores in 2016 showed a polarization trend. Some strong department stores, or enterprises that focus on innovation, are still on the contrary.

In the future, quality enterprises will usher in a new growth cycle, which will optimize supply chain, enhance operational capacity, big data capabilities, and logistics capabilities, and form differentiated management to enhance their overall competitiveness.

Last year, the performance of some department stores has improved significantly through adjustment and innovation.

Stand on

The most advanced department stores are recovering their courage and confidence.

In 2016, the annual operation statistics of the 85 member enterprises of the Chinese Department Store Association showed that the total sales volume of department stores was 656 billion 690 million yuan, an increase of 5.45% over the 622 billion 761 million yuan in 2015, and the total profit was 4 billion 4 million yuan, an increase of 12% over the 3 billion 575 million yuan in 2015.

Recently, the fifteenth China department store Summit (short for "department store summit") was held in the most beautiful flower season in Beijing.

Compared with previous years, this year's department store summit has added a romantic atmosphere. At the meeting, the violinist and trombone player from different countries are using elegant music to guide the guests to relax in the interval. This rare scene reflects the frustration and low emotion that plagued the industry for a long time and is gradually dispersed. The department store, which has always been in the forefront of fashion, is recovering courage and confidence.

The meeting on the same day also confirmed this point.

Although department store growth continues to slow down, businesses are generally out of panic and confusion. They are embracing the Internet with a positive attitude, testing all channels of water, exploring cross border integration and strengthening their business capabilities.

Data show that the innovation efforts of department stores have been effective, and in the second half of last year, the industry showed signs of warming.

According to the "2016 China department store industry development report" released by the Department Store summit this year, the Chinese department store industry showed a trend of slowing down last year.

In 2016, the annual operation statistics of the 85 member enterprises of the Chinese Department Store Association showed that the total sales volume of the department stores was 656 billion 690 million yuan, an increase of 5.45% over the 622 billion 761 million yuan in 2015. The total profit was 4 billion 4 million yuan, an increase of 12% over the 3 billion 575 million yuan in 2015, and the main business profit was 15 billion 400 million yuan, down by 0.69% over the 15 billion 500 million yuan in 2015.

The total assets reached 150 billion 427 million yuan at the end of the year, up by 25.62% over the same period last year.

2016, the operating area of member enterprises increased by 15 million 140 thousand square meters, up 1.76% over the same period last year.

The sample analysis shows that in 2016, the sales increased by more than 20% in the year to year, and there were 5 enterprises; the enterprises with a growth rate of more than 10% reached 12; in 2016, only 44.7% of the enterprises grew year by year, and nearly half of the sales decreased by nearly 55.3%, of which more than 10% of the enterprises were 15, accounting for nearly 1/4 of the whole sample enterprises.

The report shows that from the competitive environment of the retail market,

The impact of the attack on department stores has not stopped yet; the diversion of shopping centres is getting heavier and heavier, and the popularity of department stores is still continuing.

Compared with the closure of 31 department stores in 2015, the number of stores has increased in 2016, such as the closing of 2 stores in the Pacific department store. Martha, the old British department store, has closed 10 stores. The shops are mainly concentrated in the second tier cities, and there is a trend of spreading to the three or four tier cities.

Chu Xiuqi, President of the Chinese general merchandise business association, thinks that in 2016, the department store industry intensified competition, homogenization was serious, the market tended to be saturated, and the development of the industry showed polarization. Some weak department stores, or those lacking innovation, were gradually eliminated by the market, and they would gradually withdraw from the retail market.

But on the other hand, some strong department stores, or those focused on innovation, are still growing against the trend and survival of the fittest.

In the future, quality enterprises will usher in a new growth cycle, which will optimize supply chain, enhance operational capability, big data capability and logistics capability, and form differentiated operation to enhance their overall competitiveness.

Last year, some department stores increased their performance significantly through adjustment and innovation.

Take the Wuhan China general merchandise department as an example, in the second half of last year, the company adopted the reform of the business system, implemented the headquarters macro management, changed the headquarters investment system, enhanced the ability of the store to take the initiative to deal with, operate independently, and assume responsibility for profits and losses, and effectively stimulated the potential of the store to create itself.

In 2016, the gross profit margin of nine stores in the eight cities of China Merchants Department increased by 15.5%, gross profit margin increased by 2.8% compared to the same period last year, and the profit increased by 192% over the same period last year.

The New World Department has organized and adjusted the organizational structure of its headquarters and regions in order to ensure that the group strategy can be promoted and implemented quickly and effectively, so as to enhance operational efficiency and competitiveness. 2016/2017 interim results show that the company's net profit increased by 54.6% over the same period last year.

An executive of Limited by Share Ltd in Beijing Cui Wei told China Business Daily that the performance of shopping malls in the second half of last year showed signs of improvement, and that this trend of improvement in the first half of this year was more obvious.

"In the second half of last year, the situation began to improve and the decline narrowed."

He Lixia, deputy general manager of Limited by Share Ltd marketing operation Department of Beijing first group, told the China Commercial Daily that sales of the first business group's stores had improved in the second half of last year, especially sales of sporting goods, cosmetics and household products, mainly based on personal consumption tendency.

She said that this is because the company has made a series of adjustments in business, goods and services are more suitable for consumption demand; on the other hand, consumption upgrading has also brought new demands; in addition, it may also be partly affected by inflation factors, thereby boosting sales.

On the eve of the current department store summit, the Chinese retail giant Bailian Group, which was criticized by the industry for lack of innovation spirit, announced the signing of a strategic cooperation agreement with Alibaba to explore new retail opportunities in the ecosystem of each other in February 20th.

The two sides will use big data and Internet technology to achieve all-round cooperation in six major areas, including integrated offline stores, commodity resources, logistics capabilities and payment tools, so as to provide consumers with new consumption experience at any time and anywhere.

For Bailian, alliance with Alibaba can bring internet gene and thinking to the company quickly, so as to reform its business and launch more O2O strategies.

Although Bailian has launched its own full channel business platform, "I," but its traffic is insufficient.

Through cooperation with ALI, using Ali's big flow, big data and logistics capabilities, Bailian hopes to make the O2O strategy better.

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In the past, Bailian Group's Xuhui department store, the East department store, was upgraded and pformed in 2016. The brand new Huaihai 755 brand was pformed from simple department store operation to buyout itself, and the brand buying system was launched for the first time.

The pformation and upgrading of Dongfang commercial building did not change the business model based on department stores, but only used "buyers" and "vision" to redefine traditional department stores.

In the new layout, there are quite a few self operated spaces. For example, the 670 square meter men's brand collection hall adopts the form of store in store, and the private custom service is launched to provide consumers with professional and unique collocation suggestions.

Dongfang shopping center also recruited more experienced buyers in Lafayette and Lafayette department stores, and he opened up an international shopping area in the shopping mall to sell the goods purchased by the buyers to major fashion week.

Dongfang mall tried to cross the border and opened a self catering Cafe called "coffee".

The goal of Dongfang shopping mall is to build a buyer team that collects global products through diversified and multi form training, so as to realize the pformation of "buying department stores".

The pformation of Bailian Group is a microcosm of the pformation and upgrading of China's department stores.

After a great impact since 2013, today, the department store industry has stepped out of the panic of that year and embarked on its path of pformation and innovation.

At this department store summit, Zhou Qing, vice president of the Wangfujing group, which is well-known in department store operation, introduced the experience and experience of Wangfujing group pformation.

Since 2014, Wangfujing group has introduced reform and innovation including business philosophy, business mode, commodity supply chain, organizational pformation, differential management, regional deep tillage, etc., and has comprehensively upgraded the operation and management of enterprises, and has achieved certain results.

In November last year, the Wangfujing group announced the establishment of a full channel center, which reorganized the original marketing department, the electricity supplier company and the whole channel project, and upgraded it to an important business center in the group headquarters, so as to co-ordinate the whole channel construction of the various formats of the group.

In terms of self management, Wangfujing group is seeking deep cooperation with the brand on the one hand, and actively developing its own brand on the other hand.

Insiders from the Wangfujing group told the China Daily News that another private brand of the company will go to the market next month.

Nanjing Xin Bai quickly enhanced its business capability through overseas acquisitions with its own brand old foreign department stores.

In 2014, Nanjing Xin Bai bought the shares of House of Fraser 89% of the British department store and introduced the famous old department store to China.

In December last year, House of Fraser opened its first store in China, East Fred, in Nanjing.

Orient flad, based on "self + buyer", owns nearly 20 exclusive brands.

Kong Jun, CEO of House of Fraser and chief executive officer of East Fred, revealed that in Eastern Fred's stores, the proportion of its own and buyer's business has reached 50%, and the response of customers after the opening of stores is even better than they expected.

At the same time, the company also opened online e-commerce business, radiating sales and service radius to all China.

"No matter whether the online or offline is a means, it is the customer's demand that changes all the time."

Kong Jun said that in the future retail pformation, the entity store can become the foundation of the line.

At present, department stores are turning to deep ploughing supply chain, strengthening self business, seeking cross-border pformation, and expanding the whole channel development through online and offline integration, so as to realize the integration of business on line and offline.

According to a survey conducted by the Chinese general merchandise business association and the Li Feng Research Center, 73.4% of department stores have been actively cooperating with suppliers and brands in recent years.

In the way of cooperation, 59.6% of department stores take part in the terminal sales management and sales data sharing between suppliers and brands, and 48.9% of department stores participate in inventory management and stock data sharing. 46.8% of department stores adopt single product management.

In addition, 69.8% of the surveyed department stores have been involved in retail formats outside department stores.

At the same time, 50% of the surveyed companies have already collaborated with Internet companies in developing O2O; 32.1%'s surveyed enterprises are planning to cooperate with Internet companies in developing O2O.

"Department stores are very suitable for high-end consumer groups."

Marco Hamers, executive vice president of Li Biao brand group, said at the Department Store summit that the brand of Li Biao has been in China for more than 450 thousand square meters in the past 20 years. From the data of their brand management, it can be seen that the turnover rate of high-end brands in department stores is the highest and the share of sales is the largest.

Basically, the location of all department stores is located in the center of the city, which is very advantageous, but the overall shopping area is limited because of the limited area, which is a common problem facing the industry.

At the same time, department stores also face a series of problems, such as outdated thinking, inconsistent commodities and complicated channels.

"Next, let's see how the department stores change, step by step, or go to the overall adjustment and the overall layout."

Marco Hamers said the key is to catch customers with spending power.

1. Bailian Group's Xuhui department store, the East department store, has been upgraded and pformed in 2016. The brand new Huaihai 755 brand has been pformed from simple department store operation to buyout itself, and the brand buying system has been launched for the first time.

2. Nanjing's new 100 overseas stores have been rapidly enhancing their business capabilities through overseas acquisitions of old foreign funded stores.

In 2014, Nanjing new 100 bought the shares of House of Fraser 89% of the British department store, House of Fraser, the first store in China, based on "self Plus + buyer", and the proportion of its own and buyer's business was 50%.

3. last year, some department stores increased their performance significantly through adjustment and innovation.

Through the reform of the business system, Wuhan China Merchants implemented the headquarters macro management, changed the headquarters investment system, enhanced the ability of the store to take the initiative to deal with, operate independently, and assume responsibility for profits and losses, and effectively stimulated the store's self creation potential.

4. Wangfujing group has launched reform and innovation including business philosophy, business model, commodity supply chain, organizational pformation, differential management, regional deep tillage, and so on since 2014.

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