Despite various challenges such as COVID-19 resurgence and stagnant consumption, many department stores in China performed well and their revenue reached an all-time high over the past year. This indicates department stores remain the main channel for fashion and quality consumption.
Department stores bring together fashion leaders and consumers. They represent a city's commercial success and remain a crucial sales channel for high-end brands. Some department stores are even landmark buildings in the cities where they are located, and internationally renowned department stores often maintain a mutually beneficial relationship with their cities. Currently, several first-tier cities are vying to become international consumption centres, and department stores play a key role in these efforts. Department stores are also the first choice for fashion and quality consumption in second- and third-tier cities and below.
Conditions for the development of the department store industry remain favourable despite uncertainty in the overall business landscape. We expect the development of the department store industry to be supported by the long-term economic development, a shift to local spending from overseas spending, individualized needs of the younger generation, increasing quality spending, and the rise of domestic brands and products.
China's department stores are ahead of their international counterparts in digitalization, but they are still weak in store image, visual merchandising and display, product management, and customer service. The underlying reason is that many department stores still operate with traditional mindset and lack awareness and motivation to change. The gap between traditional business thinking and new consumer demand has resulted in a misalignment between demand and supply.
China's Department Stores Report 2021-2022 collects and analyzes data from 85 department store operators. The report analyzes development trends in the industry in the past year, discusses major issues and challenges facing the industry, and puts forward policy recommendations from retail enterprises to promote the healthy development of the industry.
For Department Stores Report of the previous years, please visit here.