How Did The Retail Industry Fight Self-Defense Counterattack?

This is the best era and the worst.

The number of confirmed cases of new crown pneumonia in the world has exceeded 900 thousand cases, which is a terrible number.

With the exponential growth of newly diagnosed cases, the anxiety and panic among people are increasing. After all, the global epidemic war is still in progress.

However, many tycoons have been unable to sustain them.

Department store giant "miserable"

1 Messi's department store was kicked out of the S & P.

After falling to its lowest level on Wednesday, Messi, the largest department store in the United States, was declared off the mark by the S & P index. After that, its small cap index was added, and its location was replaced by Carrier Globa, a heating and air conditioning company.

Since the beginning of the year, its share price has dropped by 70%. So far, the market value of Messi's department store is only about 1 billion 372 million dollars.

Apparently, Messi, a department store chain of the world known for its Thanksgiving Day parade, failed to survive the storm. From then on, all 775 stores in the United States were shut down, and about 130 thousand retail terminal operators were laid off this week, forcing most employees to take leave. Big.

"Although these measures help to improve the situation, they are still not enough. Action will be taken to reduce the number of employees to an absolute minimum and to maintain basic operational needs. " Messi department store

2 Lotte Department is accelerating its withdrawal from the Chinese market.

At the same time, on the other side of the sea, a tycoon who had taken advantage of the draught was also "lingering". Korea's Lotte Department once again accelerated its withdrawal from its business in China.

Due to the impact of related industries and market environment, the difficulties faced by shops are increasing and irreversible. Lotte Department Store Shenyang will be closed in April 30th. As a result, Lotte Department stores will only have 1 stores in Chengdu Global Center store in China.

As we all know, in recent years, Lotte Department stores have not had a good time. Due to the internal management disputes, the failure of the distribution channel strategy and the negative factors such as the boycott caused by the Sade incident, its overall business status has been in the doldrums.

According to the latest earnings report, the loss of Lotte shopping in 2019 expanded to 853 billion 560 million won in the previous year's 464 billion 990 million won, and the combined operating profit dropped by 28.3% compared with the same period last year, and sales dropped 1.1% last year, announcing that a major business restructuring will be made.

Sales of China's Lotte in China have shrunk from 11 trillion and 390 billion won in 2016 to 2 trillion and 630 billion won in 2017, with a total loss of 1 trillion won (about 6 billion yuan). This has led to the decline in sales in the first year since Lotte's expansion overseas in 2005. Korea daily

And the outbreak of the epidemic will once again lift its reputation as a poor wound. Once again, there is no alternative but to continue to shrink the business line at a special time.

Obviously, under the influence of the outbreak of the global epidemic, the retail industry, which is the first to bear the brunt, is still in the brink of storm.

Retail industry suffered heavy losses

As we all know, retail industry is the largest employer in the private sector in the United States, providing about 52 million jobs. Under the epidemic, they share the same pain. The major brands and retailers have been avoiding the limelight and choosing to close down or shorten their business hours. The most direct result of this choice is the profit pressure generated by the decrease in revenue.

"If sales are shelved, wages and benefits, rents and loan payments are all a heavy burden." - Matthew Shea, chief executive of the National Retail Federation

The Gap Group expects that the first quarter sales in 2020 will lose about $100 million by the new crown pneumonia epidemic and will close about 170 Gap brand stores worldwide this year.

In the three months ended February 29th, Nike group's net profit plunged 23% to $847 million, less than market expectations ($948 million).

Sales of Andemar brand will fall by 50 million to $60 million in the first quarter, and in order to balance expenses, the company is considering abandoning its original plan to open a new flagship store in New York.

At the same time, the latest retail sales figures of Hongkong in February were also thrilling with the heavy blow of the new crown pneumonia epidemic to tourism and consumption related activities.

According to statistics, the value of total retail sales in Hongkong in February was temporarily estimated at HK $22 billion 700 million, down 44% from the same period last year, breaking the record. Among them, the sale value of jewellery, watches and clocks and precious gifts was the largest, with a year-on-year decline of 58.6%, a decline of 49.9% in clothing category, and a decrease of more than 40% in the categories of drugs, cosmetics and department stores. In the first two months of 2020, the volume of retail sales in Hongkong dropped by 33.9% over the same period last year.

In addition, according to GlobalData data, the UK retail industry expects to lose 12 billion 600 million of its revenue this year. Among them, clothing and footwear will be the most affected industries, with a year-on-year decline of 20.6%.

An industrial crisis triggered by the epidemic is brewing, and retail industry can not avoid it. How to save itself at the time of multiple losses has become the most critical development proposition.

"If you don't have a sound financial foundation, you simply can't stand the storm." Saunders, general manager of GlobalData Retail, a retail consultancy.

How to "save oneself from strength"?

First of all, when the industry has not yet been combated by the blow, the policies led by the state will be a good shot in the first place.

Take China as an example, compared to the terrible situation of overseas countries and the effective implementation of China's epidemic prevention policy, the resumption of production in various industries is being carried out in an orderly way. By the end of March, the resumption rate of department stores has reached 95.8%, an increase of 35 percentage points from the end of February, and sales volume returned to about 50% of the same period last year. However, due to the cautious attitude of the epidemic and the fact that the consumption power has not really awakened, the bottom up of market sales also needs the supplementary stimulus of the policy to stimulate it.

"From 2020 to February, the total retail sales of consumer goods decreased by 20.5% compared to the same period last year." the total retail sales of consumer goods decreased by 20.5% over the same period last year. Among them, retail sales decreased by 17.6%, retail sales of travel commodities decreased significantly, catering revenues dropped by 43.1%, and the income of accommodation rooms above the limit dropped by nearly 50%. National Bureau of Statistics

1. the "red enveloped rain" has come?

Consumer vouchers will also "re emerge".

According to Keynes's economic theory, under the condition of insufficient effective demand, increasing government expenditure can stimulate the private demand and the national economy, thus achieving the multiplier effect. This means that under the epidemic situation, it is reasonable to use consumption vouchers to stimulate consumption and stimulate economic vitality, which can be adopted as a special means in special period.

In March 12th, Nanjing issued 318 million yuan coupons to the public and the disadvantaged groups, including 7 major categories, such as food and beverage, sports books, etc.

In March 16th, Anhui formally announced the joint efforts of hundreds of upstream and downstream brand suppliers to jointly launch a 100 million yuan consumption subsidy.

In March 18th, more than 300 enterprises in Beijing jointly promoted consumption and issued 150 million yuan coupons to the public.

In March 26th, Hangzhou announced that it issued 1 billion 680 million yuan coupons to all personnel in Hangzhou, and the first issue was 100 million yuan on 27.

In March 31st, Shenzhen Luohu District announced that it would issue 30 million yuan coupons to consumers from April 1st, and WeChat would be able to make an appointment with the scan code.

By the end of April 1st, more than 30 cities and districts including Nanjing, Hangzhou, Ningbo, Chongqing, Foshan, Shenzhen and Zhengzhou had issued consumer coupons to promote consumption, and the amount was from 10 million yuan to 100 million yuan.

For now, the issuance of consumer vouchers has given consumers some motivation and effectiveness.

According to the relevant urban data, as at 22:00 on March 30th, Hangzhou residents have paid 41 million 120 thousand yuan of government subsidies, which led to 637 million yuan consumption in Hangzhou and 15 times the leverage multiplier effect. Meanwhile, in from March 18th to 22nd, 34522 electronic consumer coupons were used in Nanjing, the total consumption amount was 9 million 429 thousand and 300 yuan, and the consumption amount was 6 million 131 thousand and 600 yuan, excluding electronic consumer coupons.

However, the issuance of consumer coupons is not an omnipotent move. It has certain limitations and can only be a step of "combined boxing". After all, the driving force of spontaneous consumption is durable. In addition, merchants themselves enhance their market competitiveness to attract consumers, so as to further realize the virtuous circle between consumption, investment and production between the three.

2. digitalization or necessity

Self rescue is still reflected in the "self" two, the retailer's spontaneous exploration is very important in this period.

The outbreak of the epidemic has forced the traditional retail industry to "retreat". But with this change, everything is conserved. The performance of online business can be said to have made rapid progress. The window of online shopping, online education, online finance, online video and other "home life" mode has been opened, which has deepened its penetration and recognition, and has entered the homes of ordinary people.

And this is undoubtedly a rebirth opportunity for the traditional retailing industry. How to get rid of the shackles of the rule of law and how to bring new value growth points to the digital transformation itself is probably the current reflection point of all retailers.

Under the pressure of the new crown epidemic, the live broadcasting industry and the electricity supplier industry have been refreshing under the strong supervision, and the traditional retail industry has once again realized the true meaning of the general trend. This trend is to focus on online services, cultivate or adapt to the new shopping habits of consumers, so as to open up new growth points.

And here it is. Whether it is Wei Ya, Li Jiaqi, or even, led by the net red live with goods, or the laying of the electricity supplier channel, will break through the time and space constraints, drainage + channel integration go hand in hand, bringing the digital new life, and then bring some complements to the poor sales.

You know, consumption is a reflection of the changing relationship between supply and demand. In today's global tide, the Internet connects you and me. Intellectualization and digitalization of layout and investment are not only an option, but also an inevitability to improve efficiency.

epilogue

A new crown disease has made this 2020 unusual. After experiencing the baptism of ill years, people's awareness of health and safety has been sublimated again, and the market competition among enterprises has entered a new shuffle cycle.

And such an unusual 2020 has passed 1/4, but the rise and fall of the retail industry may be thousands of turns, the old do not go, the new does not come, the retail industry "people, goods and markets" are being rebuilt, and the new business form in the trial and error of enterprises is also urgently needed to shape.

It is certain that the early termination of the epidemic will continue to open the second half of the retail industry's rebound. But when we seize the opportunity to promote our growth, will there be a place for Messi department stores struggling with old age?

After the end of the war, the new retail campaign needs to start.