Where Is The Direction Of Retailing?

Yes, just like all other department stores that are losing money, such as Messi's department store in the US, Sears's department store and Neiman Marcus, from Britain.

Although it is not so bad that even mom and Dad don't know it, it also faces the dilemma of almost original performance.

According to Martha's earnings report, sales in 2016 increased by 0.8% to 10 billion 40 million, but pre tax profits fell by 19.5% to 483 million pounds.

Among them,

Sales fell 2.2% to 3 billion 900 million, while food sales increased 3.6% to 5 billion 400 million pounds.

These figures are also based on the conclusion that online sales have increased by 23%.

Selling their own goods is the direction of retailing.

The performance of Martha's Department illustrates two things:

1, compared with those department stores that sell other family goods, they still sell their department stores a little better.

That is to say, you have to provide uniqueness.

In 1926, Marsha began to implement the policy of "direct purchase from manufacturers", so that not only can reduce intermediate links and reduce costs, but also maximize the control of commodity quality.

At headquarters in England, they also have specialized procurement centers, which can produce products to the world according to the needs of different categories, and then coordinate the pportation of finished goods from the production sites.

If you visit Marsha, you know that more than 80% of the products sold in this department store are self produced and self marketing brands.

That is to say, retailers and brands are the same - you can even regard Marsha's clothing department as an example.

Look at it.

Just on the display of goods, Marsha's dress hanging method is more "department store" - the clothes are facing you, so that you can see a piece of clothes at a glance; not like ZARA, every dress is "sideways" against you, you have to open those clothes to see clearly what the dress looks like.

Different display methods directly led to the same business area, ZARA clothes can be hung more, and the rental cost to each item of clothing is relatively low.

And the way of display in Marsha's department makes the rent cost higher for each piece of clothing -- the world is fair, and you pay the price of "clothes" labor, you need to pay a lower price.

However, if we compare the products in the department stores, we will ensure that the profit margin of Marsha is much higher than that of other department stores.

2, clothing has become increasingly immovable. What is the future straw in the department store? High-end food.

Clothes are becoming more and more immovable.

This is what I want to talk about with you today.

Let's start with the problem faced by Marsha's department store and the whole department store -- "clothes are getting more and more sold".

Looking at the environment, the consumption of clothing in the mature market is becoming weaker and weaker. The Chinese market may also go through this stage in the future. The economy has now recovered 7788, but official data show that clothing consumption in the UK has entered the weakest selling cycle since 1991, and the clothing consumption per person in 2015 has reached 32.

Let's take a look at the changes in the clothing market.

Although Marsha is still the first clothing retailer in the UK, its market share has been declining, which has made the market share of Marsha's clothing industry in the UK fall from 16% in 1997 to 11% in 2010 and then to 9.9% in 2016.

The narrowing of the market share shows that Marsha's clothing business is being robbed by competitors.

Compared with competitors, there are probably several problems in the clothing business of Marsha.

1., inverse inventory problem. This is a new word I created myself.

That is to say, when customers arrive at Marsha, they often find that the size they want to buy has not been able to find the size they want.

The problem behind this is that the team of Marsha's buyers often fails to predict the market accurately and dare not make big orders.

This not only does not make Marsha do business, but also reduces the stickiness of customers.

Of course, there is a moderate and subtle balance in this, because if the stock is too much, it will cause the pressure of inventory and promotion, which will detract the profit.

2. it's too hard to walk around, and customers don't find it efficient to walk around in the store.

To some extent, the challenge of the department store industry is unprecedented because its business model can no longer satisfy the consumption habits of the new generation of customers.

Department stores usually display products according to brands, and brands are still important to customers, but more often than not, in order to save time and energy, people choose to order products first, first look at categories / functions, then choose brands.

3. positioning problem, this problem is the most fatal.

In the past, the most popular image of Martha's department store was a medium price department store that mainly provided clothing for middle-aged women.

According to the world clothing and shoe net, 58% of Marsha's customers are women, 54% of customers are over 50 years old, and 22% of customers are under 35 years old.

A few words aside, Martha's department store entered the Chinese market. In 2008, Martha opened a 3 storey shop in the Nanjing West Road golden area of Shanghai, and then opened up different stores in Huaihailu Road and Beijing world trade scale in Shanghai, but eventually ended in failure. Martha department stores said that overseas expansion was not smooth and the 10 stores in the Chinese market should be closed.

Many people who have visited Marsha complain that clothes are too old and too big to be localized.

Now you should understand that this is caused by the core position of Martha's department store. People sell clothes to middle-aged women.

But in China, the women of this age can dance to the square dance with the brand name dress of 30-200 yuan in the street shop, or the local brand with no name.

In another breath, he wore a pink purple T-shirt with Armani on his chest, estimated from Italy's orlies.

The consumption of Chinese mothers and British mothers is 30 years apart.

Moreover, Martha department store stalls are not big enough, and marketing is not so vigorous. It has not yet been cultivated into a brand that is deeply rooted in the hearts of the people.

Come back to the British home market.

Marsha's clothing products, on the one hand, lack precise targeting of core customers; on the other hand, in terms of merchandise display, most of the products of Marsha general store do not seem to be logical. They are not as popular elements as other fast fashion shops, nor are some high-end clothing stores displaying products with styles or colors.

It's easy for a customer to enter the store. After a glance, he finds that he has no attraction and goes out.

{page_break}

Those customers who are interested in clothes will find that the middle price of Marsha clothing is somewhat awkward. Marsha claims that the price of his home is "cost-effective", and that a skirt inside sells about 300 yuan, but it is 100 yuan lower than this price, so you can buy a more fashionable style in ZARA.

If you look at the clothing brand on the market, you will probably know how the market is being differentiated: cheap brands, or selling popular trends, such as ZARA, or selling quality products that are good enough to wear, such as UNIQLO, sandwiched in the middle, selling H&M with a little quality, and being proved to be in crisis from the same store.

Those cheaper clothes go directly to the pockets of teenagers, such as Primark.

And the clothing brand with a unit price of more than 600 yuan, even if the quality is not good enough to afford the price, is selling a story or lifestyle that everyone is willing to pay for it.

And think about Marsha, which has low price, fashionable, good story or lifestyle.

In response to the above three questions, the answers given by Marsha general store are: 1., adjust the distribution of goods, increase the rate of goods to shops from 61% to 84%; 2. change the way of displaying goods: no distinction is made between brands, but with product types, such as shirts, skirts and trousers, to distinguish display; 3. reduce prices.

Behind the price cuts is the former CEO Bolland of Marsha's Department, who dug up a pair of brothers who were specially responsible for purchasing from the clothing retailer Next in 2014: Neal Lindsey and Mark Lindsey, and they terminated cooperation with many long-term suppliers, who were often intermediaries and worked with the most original supplier.

Of course, this directly reduces the cost, but risks and opportunities coexist: cooperation with new suppliers, quality control has to be re established. If customers are not satisfied with the quality of clothing produced, reducing costs will not be worth the candle.

Speaking of which, I think there is always a doubt in your mind. Why is Marsha general trying so hard to save the clothing business? Since the environment is not strong enough, and the business share of the food business has surpassed that of the clothing business (58:42), what is the picture of this?

The answer to this question is why Martha has hesitated to develop food business before: the price of clothing products is higher and the profit is higher. If we reduce the clothing business at once, it will be a blow to sales and profits.

Food is the future of department stores.

But the historical trend has been irreversible: clothing sales fell for 3 consecutive quarters, while food sales continued to grow for 25 consecutive quarters. When the market share of clothing fell, the market share of foodstuffs increased. Currently, Marsha's Department accounted for 4.3% of the market share of British food, and the number of customers buying food in Marsha's Restaurant reached 42%, which is 4 times the number of competitors in the department stores.

In April 2016, the new CEO Steve Rowe of Marsha general took office in Marsha for 25 years and was responsible for the food business.

This is a clear sign that Marsha began to pay attention to the food business.

In the year of 2016, Marsha opened 75 stores in the United Kingdom, Simply Food and smaller shops, and opened 7 overseas markets.

For the existing Marsha general store, the area of food has also been expanded. In Marsha's largest store, the area of food now accounts for about 1500 square meters, which is almost an imported food supermarket. In the medium Marsha general store, the area of food is about 700 square meters.

In the future, it is possible to expand capacity by 30%.

(btw) it's also funny. About 10 years ago, Marsha's department also reduced the sales area of food in the shop.

)

In 2016, the number of new food products released by Marsha general store reached 1700, accounting for 25% of the total food quantity.

The speed of innovation is amazing, resulting in only about 10% of the food in Martha store, which is almost the same as that of competitors, and the difference between Marsha and supermarkets.

New products, including Greek, Lebanese and Spanish flavored cooked food, also upgraded to India flavor and Italy pizza, and sales of Italy pizza increased by 28% year-on-year.

According to data from Barclays Bank Credit Card Center, the consumption of British people in restaurants and bars increased by 14.4% and 10% respectively in 2015, but the overall sales of food and beverages increased by only 1%, demonstrating the trend of British eating abroad.

British supermarkets Sainsbury 's, Waitrose and Tesco have opened up more fast-food and cooked food areas.

In addition, Martha intends to further expand the area of coffee and fast food business.

I don't know if you have any impression of the former Marsha Shanghai Nanjing West Road store. At that time, the decorated coffee shop on the third floor was actually very popular, and the taste of coffee and sandwiches was also good.

But at that time, Marsha just regarded this cafe as a place to stop people, and did not further explore its function to drive people, or even to drive food sales.

Even in China, Marsha's food attracts many young people.

A friend of mine used to go to Martha for some chocolates because he liked chocolate.

At that time, in the Marsha shop in Shanghai, there was still a good quality red wine and fruit wine that could be purchased with more than 100 yuan. Later, fresh baked bread was also served in the world store in Beijing.

In short, if Martha is more patient with the mainland market and opens up the hearts of Chinese consumers with food, it may not be the end result.

More interesting reports, please pay attention to the world clothing shoes and hats net.