Department Store Industry

1: INDUSTRY OVERVIEW: DEPARTMENT STORES

Department stores are large retail outlets that contain numerous individual shops, providing a wide range of product lines. Department stores most oftentimes consist of the following product categories:

1)      Food

2)      Cosmetics

3)      Shoes and Accessories

4)      Clothing

5)      Interior Décor

6)      Restaurants

Depending on the type of department store, department stores can offer a much wider range of products, including furniture, toys, electronics, books, etc.

Department stores come in a wide range of qualities and prices. There are such things as “high-end department stores”, which would focus purely on offering high-profile brands and products, while there are more mass-market targeting department stores, which are more likely to include a wider range of products, including practical household products.

That said, department stores will oftentimes try to cater to specific types of market segments. Particularly in the case of department stores in large cities, each department store will try to position itself differently from its direct and nearby competitors: some will try to cater to younger generations, while some will try to cater to the older generations. Some will try to cater to those interested in mainstream brands, while others will focus more on boutique, independent brands.

In the US, the department store industry includes approximately 20 companies operating roughly 3,500 stores. Major department stores in the US include: Sears, JCPenney, Macy’s, and Dillard’s. The industry earns an annual revenue of around $60 billion USD, 95% of which is earned by the largest 8 companies in the industry.

Some links about the industry:

http://en.wikipedia.org/wiki/Department_store

http://vspages.com/mall-vs-department-store-5580/

http://en.wikipedia.org/wiki/Shopping_mall

http://www.hoovers.com/industry/department-stores/1529-1.html

 

SPACE

2a: Implicit or Explicit?

From the department store owner’s standpoint, I would say that space is often sold explicitly, as they would charge the tenants per the size of the lease space. On the other hand, for stalls or booths set up in more open areas of the department store, space may be considered more implicit, as these spaces may be sold with less correlation to the exact size of the space.

2b: Ways of Splitting Space

Department stores have different types of spaces within the building that cater to their customers. The most typical type is the space split by fixed walls into one unit, and can usually be shut off or closed by a door or a shutter. These spaces cannot easily be adjusted in terms of size and layout without investment of significant time and money. These fixed spaces are generally leased out to a specific brand or company, such as Zara, Coach, Burberry, etc.

 

Then there is the semi-fixed space, such as the department store areas dedicated to selling cosmetics or shoes. These are oftentimes open areas in which a specific brand or merchandising line take up certain spaces, but are not divided up by physical walls or entryways. These areas are much more flexible in terms of changing the products being handled, given that one area can easily be changed to carry one brand/line from another; however, certain fixtures used for the displays will be fixed, and hence less flexible to change from a layout perspective.

 

There is also open space, in which temporary booths or stalls are built to sell a smaller line of products or services.

Different from other uses of store space is the use of space to purely focus on selling experiential services. For department stores, the focus generally remains on selling physical products. However, there are rare instances when space is allocated to selling services—one case being when department stores are attached to movie theaters.

 

 

 

 

 

 

 

 

 

 

 

 

2c: Creating Additional Revenue

One of the most standard ways for department stores to create additional revenue is by holding major seasonal sales. Because the product life cycle of clothes tends to be fairly short, many stores have inventory left over by the time they have to replace old products with new products. Having a highly publicized sale allows for these leftover products to be sold, be it at a lower price than its retail value.

One key to making people spend more money is to convince people to stay out shopping longer. A way to do this is to provide adequate opportunity for people to take a break from shopping and rest. Many department stores provide these venues by creating food courts—or in high-end places by providing patisseries or coffee shops at which people can recharge before going back to shop some more.

I also think one of the more creative ways in which department stores have used their space to create additional revenue is through creative use of its open space. Another approach department stores can use to bring people to their stores is to provide an additional incentive to go to that location. A common approach used to achieve this in the U.S. has been to create playgrounds in the open areas of the department stores. This service often incentivizes families to go to a department store, simply because it allows an opportunity for their children to play.

 One more approach commonly used in Japanese department stores to bring more people to the site is to host certain “festivals” or special events in their open space. For example, department stores would often host weekly “mini fairs” on either the ground floor or the top floor, in which one area of the department store would be devoted to hosting jewelry/clothes/food from brands and shops that usually were not represented at the department store. The content would be changed frequently, and the department store would often be able to bring new people into the store by publicizing new, limited-time genres of offerings at their store.

2d: Potential New Ways of Splitting Space

There are several different directions department stores could potentially go in terms of splitting space differently. One direction would be to use space to create more personalized services to customers. Many of the spaces in department stores are “public”, but allocating a portion of space at high-end stores to allow for “private” space may allow for varying experiences for customers. Customers would be charged a premium for making use of these private spaces.

Another potential use may be to make the spaces more flexible. Instead of sticking with a model that leans heavily toward having “fixed” spaces, changing to a model in which it would be much simpler, cheaper, and quicker to change tenants may be an attractive approach for department stores that are pursuing a more trendy, up-to-date feel.

3: TIME

3a: Implicit or Explicit?

Department stores generally sell time implicitly: this is because the product being sold generally isn’t associated with a particular time limit. For example, it is not like a massage, where you are buying 60 minutes worth of service. The transaction is associated with a physical product unattached to time.

3c: Selling Time Explicitly

Time is currently being sold explicitly at certain department stores, although these cases are generally not a reflection of its overall business model. For example, some department stores may include shops that offer time-explicit services. Some department stores have massage shops, which are time-based service sales.

 As another example, some department stores in Japan have small football fields on their rooftops, which people can rent out on an hourly basis.

(http://www.futaba-sp.com/omiya/2010/03/post-23.html)

 

 

Some department stores also include game centers for children—some of these entertainment options include machines that run for a set period of time per game.

 

 

 

Department stores will often have restaurants on one of their floors. These restaurants can often choose to set time limits to each group of customers (ex. 2hr limit) to be able to take in more customers during peak times.

(http://www.mitokeisei.co.jp/shop/10_skygarden/11keizan.html)

 

 

 

3d: Creative Things to do with Time

There are a couple things that could be done creatively with time—some of which may already be being done to varying lengths at department stores. One might be to offer some sort of benefit if a certain amount of time is spent within the department store. For example, if a customer was to receive certain benefits if they stayed for 5 hours at a department store on an off-peak day, this could incentivize customers to spend more money during their wait time, and this could also help to improve the image of the department store by maintaining more customers.

 

Another thing they might potentially consider doing is to include shops that provide rental services. Some shops may already do tuxedo/dress rentals, which would be time-based; they could potentially take this further by doing time-based rentals of other high-end luxury clothes and accessories.

4a/b: Physical and Non-Physical Rate Fences

Below are several examples of physical rate fences (owner-tenant relationships are more likely to be involved with physical rate fences than the tenant-customer relationships)

  • (Owner-tenant POV) Depending on the size of the space being rented, owners can choose to increase or decrease the rates
  • (Owner-tenant POV) Certain areas of a department store are likely to be more popular/convenient; hence an owner can charge more depending on the location of the space within the store (http://www.ehow.com/facts_6313023_average-retail-lease_.html)
  • (Tenant-customer POV) For services such as restaurants within the department store, tenants can set rates by charging differently between open areas and private rooms

In terms of non-physical rate fences, I would say that there are many opportunities to create rate fences, depending on the type of service/product the store sells. There are also several opportunities within the owner-tenant relationship:

  • (Owner-tenant POV) Depending on the lease period, the owner can set different rates to charge the tenant
  • (Owner-tenant POV) Depending on the credibility/attractiveness of the tenant, the owner can set different rates
  • (Tenant-customer POV) Depending on the quality of the product, functionality of the product, or time/length of the service, rates can be set differently. There is an enormously wide range of examples of this in department stores. A Gap outlet, for example, may sell a tank top for $10, while a Burberry outlet would sell a similar styled tank top for $150. Similarly, a cell phone with 3G functionality may sell at a cell phone provider outlet at a certain price, while a phone with 4G functionality would sell at a much higher price.

4c: Creative Ways to Set Rate Fences

Some ways I can think of setting rate fences creatively is to perhaps offer more intangible services—rather than just the physical products. For example, an I Love Bangkok t-shirt may only cost $5 at the actual retail shop, but if the customer already knows what he/she wants, but doesn’t want to make the trip up 7 floors and 5 minutes of walking to get there, the store could potentially charge an extra $1 to have the t-shirt brought down to the concierge desk of the department store for a quick pick-up.

45,568 thoughts on “Department Store Industry

  1. Baccarat site introduces only the nation’s largest online safety Baccarat site and casino site, which are 1,000% safe and verified. You can introduce our triple-validated casino site and meet our own verified casino site online Baccara, and provide various safety playground information.

    바카라사이트

  2. Enjoy the online baccarat. Additional 5% service coupon for new members and various events are waiting Recently, it is called Internet Baccarat or Mobile Baccarat because it uses a lot of mobile devices.

    바카라사이트

  3. The safe casino site boasts the largest quality of online casinos and is a safe playground that you can use more safely. We provide differentiated systems and improved services by actively reflecting members’ positions, and major casino site games can be accessed easily by anyone, regardless of age or gender.

    바카라사이트

  4. HOYA娛樂城【City is a premier destination for entertainment and gaming enthusiasts. With state-of-the-art facilities and a wide range of games, HOYA offers an unparalleled experience for visitors. From classic casino games to modern video slots, there’s something for everyone at HOYA. Whether you’re a seasoned gambler or a first-time visitor, HOYA Entertainment City is sure to impress.

  5. Sina Sports [https://www.misayulim.com] is a leading sports news and information platform in China. With comprehensive coverage of both domestic and international sports events, Sina Sports provides fans with up-to-date news, live scores, and exclusive content. From football to basketball, tennis to golf, Sina Sports has it all. Whether you’re a casual fan or a die-hard enthusiast, Sina Sports is the go-to source for all your sports needs.

  6. Tambang88 is a trusted online gambling site in Indonesia without using a VPN. There are many games in it where you will be very satisfied playing at Tambang88. Immediately register yourself on the online gambling site Tambang88

  7. Spirit Airlines Telefono es el número de contacto de servicio al cliente de Spirit Airlines. Puedes llamar a este número para obtener asistencia con reservas, cambios de vuelo, equipaje y más. El equipo de atención al cliente de Spirit Airlines está disponible las 24 horas para brindarte ayuda y resolver cualquier duda que puedas tener.

  8. If you require assistance with Volaris airline, the customer support team can be easily reached by dialing the designated Volaris Phone Number. Whether you have inquiries regarding flight reservations, baggage policies, or flight changes, the dedicated customer service representatives at Volaris are available to offer all types of services. If the Volaris Telefono is busy, then you can contact AirlinesPetPolicy by phone for reliable and efficient support.

  9. Cars Wreckers is a licensed and insured car wreckers Auckland company that provides top cash for cars, junk car removal services at the best price. We have a team of experienced and certified professionals who are dedicated to providing the best possible service to our customers. We offer a hassle-free and convenient service, and we will always work around your schedule. We also offer a free quote so that you can get an idea of how much your car is worth. Contact us today to learn more about our services.
    Visit:-
    https://carswreckers.co.nz/junk-car/

  10. Looking to get rid of an old car? JCPCarParts is the place to go! We offer top dollar for all makes and models of vehicles, and we’ll even come and pick it up for free. We’re the leading provider of car removals Auckland services in New Zealand, and we’re always looking for new cars to add to our inventory. If you’re looking to sell your old car, you can use our service or give us a call today. We offer competitive prices and quick, easy service. We’re the best in the business, and we’re always happy to help our customers get the most for their cars.
    Visit:-
    https://jcpcarparts.co.nz/car-removals/

  11. Top Indian IPTV is the best IPTV provider in the USA, Canada, UAE, Australia, and India, delivering top-quality Indian IPTV channels to customers across the country. As the premier Indian IPTV in USA, we offer a wide range of channels that cater to the diverse tastes of our customers. Whether you’re looking for news, sports, entertainment, or cultural programming, our IPTV service has got you covered. Our cutting-edge technology ensures that you get high-quality streaming that is both reliable and seamless. With our affordable pricing plans, you can enjoy the best of Hindi IPTV Channels without breaking the bank. Join Top Indian IPTV today and experience the best Indian IPTV service in the USA.
    Visit:-
    https://topindianiptv.com/

  12. If you are looking for beautiful girls in Rohini Escorts then you have shown up to the correct spot page because here we present the best choice of girls from the call girls service. Our Russian Escorts in Rohini great picture to pick a choice if you need to satisfy your sexual wants.

  13. Privar IPTV is the top Indian IPTV provider, offering a wide range of IPTV services that cater to a variety of needs and preferences. Whether you’re looking for a basic package with basic channels or a more comprehensive package with a wide range of channels, Privar IPTV has you covered. In addition to our Best IPTV Service, we also offer a variety of other services, such as VoIP, web hosting, and more. If you want to know more about our services, you can contact us today.
    Visit:-
    https://parivariptv.com/about-us/

  14. Tele Cafe is the perfect place for women looking for casual dating opportunities with men. Our platform provides a safe and secure environment for women to meet new people and explore romantic relationships without any strings attached. With a large user base of like-minded individuals, you can easily meet men who share your interests and preferences. Our user-friendly interface makes it easy to browse through profiles and chat with potential partners. Whether you’re looking for a fun night out, hook ups or a long-term relationship, Tele Cafe has got you covered. Join us today and start your exciting journey of casual dating with men who are ready to meet and mingle.
    Visit:-
    https://www.telecafe.com.au/for-ladies/

  15. Situs arwanatoto resmi telah di perbarui semua sistem menjadi lebih baik dan terpercaya. Dan tentu dengan bonus yang lebih menggoda untuk kalian dapatkan apa lagi game slot online gacor nya banyak sekali memberikan kemenangan besar. Jadi untuk itu sebagai promosi terbaru dari agen arwanatoto resmi tentu lebih menguntungkan untuk semua member yang mau bergabung di link alternatif : arwanatoto

  16. Free zones offer dubai many benefits to businesses, including 100% foreign ownership, 0% personal and corporate income tax, and no restrictions on repatriation of profits.

  17. Located in the picturesque landscapes of Northern Colorado, Meadows Event Center provides the best Northern Colorado wedding venues in the region. With its captivating beauty and unparalleled charm, it is the ideal destination for couples seeking an unforgettable wedding experience. As one of the premier Colorado all inclusive Wedding, Meadows Event Center offers a comprehensive package that takes care of every aspect of your special day. From the stunning ceremony spaces surrounded by nature’s splendor to the elegantly designed reception halls, every detail is meticulously curated to create a magical ambiance. At Meadows Event Center, we understand the importance of your wedding day and strive to make it an extraordinary celebration of love cherished forever.
    Visit:-
    https://meadowseventcenter.com/

  18. Al Bahar Hotel & Resort is an exquisite five-star hotel strategically positioned in Fujairah, a captivating region stretching along the Gulf of Oman on the Eastern tip of the Arabian Peninsula. Nestled in a private bay, our resort boasts breathtaking mountain views and a pristine beach stretch, making it a sought-after destination for both business and leisure travelers. As the premier hotel in Fujairah, Al Bahar Hotel & Resort goes above and beyond to provide unparalleled amenities and exceptional guest service. Our rooms and suites are designed to offer a truly luxurious experience, equipped with contemporary facilities that cater to our guests’ every need. Featuring 377 splendid rooms, suites, and apartments, each accommodation comes with a private balcony or terrace showcasing stunning views of the Indian Ocean and Marina. Additionally, our guests can enjoy ensuite marble bathrooms, individually controlled central air conditioning, satellite TV, direct dialing telephone, Wi-Fi, mini-fridge, safe, laundry and dry-cleaning services, as well as 24-hour room service. Our diverse range of room types includes Deluxe, Premium, Executive, Diplomatic Suites, and the opulent Al Bahar Suite, ensuring a perfect accommodation for every discerning traveler.

  19. Al Bahar Hotel & Resort is an exquisite five-star hotel strategically positioned in Fujairah, a captivating region stretching along the Gulf of Oman on the Eastern tip of the Arabian Peninsula. Nestled in a private bay, our resort boasts breathtaking mountain views and a pristine beach stretch, making it a sought-after destination for both business and leisure travelers. As the premier hotel in Fujairah, Al Bahar Hotel & Resort goes above and beyond to provide unparalleled amenities and exceptional guest service. Our rooms and suites are designed to offer a truly luxurious experience, equipped with contemporary facilities that cater to our guests’ every need. Featuring 377 splendid rooms, suites, and apartments, each accommodation comes with a private balcony or terrace showcasing stunning views of the Indian Ocean and Marina. Additionally, our guests can enjoy ensuite marble bathrooms, individually controlled central air conditioning, satellite TV, direct dialing telephone, Wi-Fi, mini-fridge, safe, laundry and dry-cleaning services, as well as 24-hour room service. Our diverse range of room types includes Deluxe, Premium, Executive, Diplomatic Suites, and the opulent Al Bahar Suite, ensuring a perfect accommodation for every discerning traveler.hotel in Fujairah

  20. Hey what a brilliant post I have come across and believe me I have been searching out for this similar kind of post for past a week and hardly came across this. Thank you very much and will look for more postings from you. Access the NJMCDirect portal

  21. Wow! Such an amazing and helpful post this is. I really really love it. It’s so good and so awesome. I am just amazed. I hope that you continue to do your work like this in the future also vay tien tin dung nhanh

  22. Steel wall pools are an economical and low-maintenance alternative to traditional above ground pools. They offer superior pool shell strength and performance, and feature galvanized steel walls reinforced for extra durability. Steel wall pools are quick and easy to install and require minimal maintenance, making them a popular choice for many homeowners.

    Stahlwandpool
    https://www.shop-swimmingpool.at/360-x-125-cm-stahlwandpool-rund.html

  23. A steel wall pool is a high quality and cost effective inground swimming pool which is made from panels of hot dipped galvanised steel. These panels are usually coated with an additional layer of anti-corrosion paint to make the pool last for many years. The panels are designed to interlock and form a strong and sturdy sidewall which when combined with the correct concrete base provides a strong and reliable inground pool ideal for any garden.

    Stahlwandpool
    https://www.mister-pool.de/stahlwandpool/

  24. Your post has truly captivated me; I thoroughly enjoy reading high-quality content that provides accurate and insightful information on the subject. Thank you for sharing this incredible piece. It has left me amazed and appreciative of your work
    Abogado Divorcios Stafford VA

  25. Steel Wall Pool is a type of in-ground pool that uses a steel wall, usually made of galvanized steel that has been treated with a zinc coating, for structural support. The walls are bolted together and applied to the excavated area of the pool. Steel wall pools are extremely durable and can last for many years with proper care and maintenance. They are popular for their strength and long-term value.

    Stahlwandpool
    https://www.profi-poolwelt.de/stahlwandpool/

  26. V9bet được đánh giá cực thích hợp với dân chơi Việt Nam, với hàng loạt ưu điểm vượt trội. Sảnh chơi này cũng là một trong những đơn vị cá cược hàng đầu châu Á.
     

  27. Welcome to Pune Escorts, your one-stop destination for the best Escorts In Pune! We offer an array of breathtaking beauties from all around India who can make any event memorable. Our service is renowned for its quality and professional approach.

    https://www.codella.biz/pune-escorts/

  28. Ethereum 2.0, also known as Eth2 or “Serenity,” is an upgrade to the Ethereum blockchain. The upgrade aims to enhance the speed, efficiency, and scalability Ethereum 2.0 is an upcoming set of upgrades to Ethereum that’s intended to make it significantly faster, less expensive, and more scalable. Eth 2.0

  29. Coinbase is an online platform that allows merchants, consumers, and traders to transact with digital currency. San Francisco, California, United States Coinbase is the world’s most trusted cryptocurrency exchange to securely buy, sell, trade, store, and stake crypto.
    Coinbase.com

  30. Steel wall pools are a popular choice for those looking for an attractive, durable swimming pool option. These pools are made from a solid wall of steel that creates a sleek, uniform look in your backyard. Steel walls provide superior strength, durability and are impervious to most types of water and weather damage. Steel wall swimming pools are easily customizable, allowing you to choose from many different shapes, sizes and depths. Steel wall pools are a great choice for those looking for a long-lasting, beautiful pool for their backyard.

    Stahlwandpool
    https://pool.net/stahlwandpool-4-2-x-1-2-m.html

  31. Indulge in a captivating flower delivery experience in Chelsea Heights with Melbourne Fresh Flowers. Our team of skilled florists meticulously handcrafts breathtaking floral arrangements that are sure to leave a lasting impression. From vibrant bouquets to elegant centrepieces, our selection of premium blooms ensures the perfect gift for any occasion. With our seamless delivery service, your flowers will be promptly and professionally delivered to your loved ones in Chelsea Heights, spreading joy and creating cherished memories. Trust Melbourne Fresh Flowers to make every moment special with our exceptional flower delivery experience in Chelsea Heights.

    Parkdale florist
    https://www.melbournefreshflowers.com.au/flower-delivery-parkdale/

  32. Wall and furniture films are adhesive products designed to change the look and feel of walls and furniture. They come in a variety of colors, patterns, and textures and can be easily applied to surfaces to give them a stylish new look. They can also be used to protect furniture and walls from wear and tear, and in some cases can even reduce sound levels in a room.

    Klebefolie
    https://www.decofilms.de

  33. i9Bet là sân chơi cá cược trực tuyến hàng đầu được cấp giấy phép và quản lý bởi tổ chức PAGCOR. Chúng tôi còn hợp tác độc quyền với GEOTRUST để đảm bảo an toàn tuyệt đối cho người chơi. 
    #i9bet #i9bet41 #i9bet41net #nhacai9bet #i9betcasino 

  34. Female escorts can provide a wide range of services, from companionship to sexual services. If you are looking for someone to accompany you to a business meeting or social event, an escort can be a great choice. If you are looking for someone to provide you with sexual services, you will need to be clear about what you are expecting and be willing to pay for it.

    Escorts in Lahore

Leave a Reply

Your email address will not be published. Required fields are marked *