Department Store Industry Remained Cold For The First Half Of The Year O2O Strategy Saved Wangfujing Department Store.

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To the shopping center and then to the orlis, the department store industry, which is deeply under the double pressure of rent and labor cost, is constantly changing to find a solution, but the prospect is still unpredictable.

As the semi annual report has been released, the gloomy performance of the department stores has once again made investors shout a headache.

Take the 4 listed department stores in Beijing as an example, their operating income has all declined, and only a slight increase in Wangfujing's department stores has been made in terms of net profit.

Wangfujing Department semi annual report shows that the first half of the company achieved operating income of 9 billion 433 million yuan, down 5.97% compared to the same period last year, achieving net profit of 378 million yuan, an increase of 2.07% over the same period last year.

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Huang Wenjie, President of the business association, told reporters that "at present, the operating costs of department stores are rising, and the rapid increase in rents and labor costs is the main reason."

According to the sample data of a number of department stores selected in recent three years by CB Richard Ellis, the annual compound growth of property rents and staff expenses was 14% and 18.5% respectively, while the average annual compound revenue growth of the same period was only 8.8%.

Huang Yongzhi, Guang Bai CEO, said in an interview with reporters that "the new commercial projects are rapidly peataging, and the commercial outlets are too dense, which leads to the further separation of the retail market."

In the current poor industry and increasingly fierce competition, many department stores choose to switch to O2O (online ordering, offline delivery) mode.

Liu Chunji, chief executive of the Wangfujing department store, said publicly that "the development trend of e-commerce retail industry is stronger than passive change."

Liu Chunji believes that the online shopping mall of Wangfujing extends the exclusive services of online purchase and offline inspection. The management method changes from focusing on turnover and gross margin to focusing on products, and will create better quality e-commerce websites in the future.

However, many people in the industry have reservations about the O2O model.

A brokerage analyst who declined to be named told reporters that at present, the successful O2O mode is almost no, such as the O2O pformation of Suning once suffered huge losses.

Department stores are still in winter.

Statistics released by the China National Business Information Center show that in the first half of 2014, the number of retail sales of hundreds of major retail enterprises decreased by 0.2% compared to the same period last year, and the growth rate dropped by 10.9% compared with the same period last year. The number of department stores closed to 15 in the first half of this year.

Huang Guoxiong, a professor at the Business School of Renmin University of China, told reporters that "in recent years, the national anti-corruption efforts have intensified, making high-end consumer goods plummet."

As a result, many high-end department stores have closed their stores to stop bleeding.

For example, Zhanjiang Wangfujing shop and Beijing Dazhong Temple store are closed.

Data show that from April 28th to June 30th, there were 12 stores in 8 department stores, including Baisheng department store and Zhong Du department store.

"Wangfujing

In the first half of the year, operating profit decreased by 7.5% compared with the same period last year. The reason is that North China is affected by the policy of honest and clean government and the high base effect of gold jewelry. At the same time, the cost of new stores in other places is rigid. In the first half of the year, the net profit loss of the stores corresponding to the subsidiary companies was close to 100 million yuan.

An analyst at Changjiang Securities told reporters.

"Facing the increasingly fierce challenges, the difficulty of merchandising and operation management in department stores will increase unprecedentedly."

Chu Xiuqi, President of China general merchandise business association, stressed in an interview with reporters.

Huang Wenjie also believes that many department stores have begun to make adjustments in the choice of regional strategies and make an attempt in O2O, hoping to bring new opportunities to the department store industry through online and offline integration.

In the second half of 2013, entities such as Suning, Wangfujing department store, Tianhong mall, Yintai mall and other retail entities launched O2O strategy. Traditional Internet companies such as Tencent and Alibaba also penetrated into the real industry, expanding sales channels and realizing the power and complementarity of online and offline resources.

Industry experts generally believe that the Wangfujing department store's O2O strategy has great demonstration effect, especially the online shopping mall which invested 100 million of its capital construction. After more than a year's operation, it has become one of the main battlefields of its O2O operation.

In the case of the department store's overall decline, the net profit of Wangfujing department store in the first two quarters of 2014 has maintained a two digit growth year on year.

However, insiders pointed out that the implementation of the O2O electricity supplier mode is a challenge to the offline capability of Wangfujing department stores.

In particular, factors such as the usual thinking of enterprise management, organizational structure of enterprises, and customary business models of enterprises will have an impact on its O2O strategy.

At the same time, Wangfujing department stores also use WeChat payment as a new payment method.

Liu Chunji believes that whether the web page or the physical version of WeChat payment experience is good.

In the future, after the PAD of the virtual counter is launched, the guide will generate a two-dimensional code. The customer will sweep the counter and pay the money to take the goods.

Adversity pformation faces challenges

For department stores, another alternative is shopping centralization.

Guo Fanli, a retail industry researcher at the China investment consulting industry and Policy Research Center, told reporters that "shopping centers are aimed at attracting consumers by directly increasing the consumer experience and directly attracting consumers, thus becoming the first choice for pformation of department stores."

Reporters found that shopping centers are the first choice for many department stores.

For example, the modern department stores in Guangzhou have taken the initiative to lose weight, increase the rental area, introduce catering and other elements, and turn department stores into shopping centers; Tianhe department store is exploring low-key private brands.

In Shenzhen, Mao ye, Tianhong, Hai Ya and Bao Bao choose shopping centers as a pformation format. In Beijing, Wangfujing, world trade and SOGO also choose shopping center formats.

However, there are different opinions on this.

An industry insider said in an interview with reporters, "shopping centers and department stores are not consistent in terms of format, profitability, operation and management priorities, and the pformation of department stores will be somewhat difficult."

In addition, there is another hot trend in the pformation of department stores.

The format is mainly famous discount, with the advantage of price to attract consumers to meet the dual needs of consumers' quality and price, such as Guangzhou modern, Tianhe City, Guangzhou friendship (000987, stock bar) and other department stores are pferred to the representative of outlets.

In this regard, Wangfujing department store has also begun to layout.

It is reported that Wangfujing department store "shopping experience + one-stop consumption" features shopping centers and "famous products + discount" features of the outlets format, with its own characteristics show a good momentum of development, especially after the acquisition of spring department stores, Wangfujing department stores in 28 cities nationwide already has 49 stores.

"The acquisition of spring department stores in Wangfujing is a typical diversified development."

Guo Zengli, director of China shopping center industry information center, told reporters that "after purchasing spring department stores, on the one hand, it enriched the format of Oteri J, and at the same time produced a synergy effect of department stores."

With the acquisition of the modern mall and Gan Jia Kou building by 2 billion 460 million yuan, Cui Wei will become the third main force in the Beijing market after the Wangfujing and the first commercial shares, and the market share will rise from 10% to 15%.

But there are many voices of doubt in the industry.

Zhao Ping, deputy director of the Consumer Economics Research Department of the Ministry of Commerce, told reporters: "department stores do not have unique advantages for orlies and have no experience in handling tail goods.

At present, there are no successful cases in the world. Oteri J's format should not be a way out for the Department Store pformation. "

In her view, domestic outlets are facing the problem of limited supply, and it is difficult to invest.

Overseas outlets are factory outlets, the mode is brand self-development, developers and operators collect rents, while domestic agents are operated, with links added in the middle, prices will naturally not come down, and the discount will be very limited.