by

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.

30,999 thoughts on “Department Store Industry”

  1. Juggling work and studies felt like a three-ring circus act until I discovered Global Assignment Help. Their Assignment Help was a game-changer! Not only did it lift the weight of deadlines, but the assignments were so well-crafted, my professor thought I’d hired a ghostwriter. Global Assignment Help commitment to originality and academic integrity gave me peace of mind and a major GPA boost. – George Cameron, Stanford University

  3. Thanks for the insights on revenue management in the lumber industry. Your article offers practical strategies for optimizing revenue, especially with Lumber Takeoff . Accurate takeoff services are key for cost estimation and project planning, enhancing precision and profitability. The synergy between data-driven decisions and efficient takeoff services is evident.

    Exploring innovative tools for lumber takeoff services can be a game-changer for optimization. Your article’s depth and practical implications for industry professionals are appreciated. Looking forward to more insights on revenue management strategies.

  4. Face Skin Whitening Tips whitening tips for the face have gained popularity in various cultures as people seek ways to achieve a brighter and more even complexion. While it’s essential to embrace and celebrate diverse skin tones, some individuals may choose to lighten their skin for personal reasons. It’s crucial to approach skin whitening with caution and prioritize health over aesthetic concerns. Here are some face skin whitening tips that focus on promoting healthy skin Firstly, maintaining a consistent skincare routine is fundamental for achieving radiant and even-toned skin.
    Face Skin Whitening Tips

  5. The advancement of technology in recent years has led to the rise of online slot casinos. As more and more people have access to the internet, the popularity of online gambling has increased significantly. Online slot casinos provide a convenient and exciting way for players to enjoy their favorite games from the comfort of their own homes.

    One of the reasons for the popularity of online slot casinos is the convenience they offer. Unlike traditional brick-and-mortar casinos, players can access online slot casinos at any time and from

    Pos4d slot
    https://rsac.org

  7. The article’s emphasis on dispelling myths surrounding Bitcoin mixers promotes a more accurate understanding of their purpose and legality. m8bet

  8. In the evolutionary journey of industries, conceptual innovations act as catalysts, propelling transformation and ushering in a new era where innovation is not an option but a necessity.

  10. Online slot casinos have gained immense popularity in recent years, allowing players to enjoy their favorite slot games from the comfort of their own homes. While there are many advantages to playing at an online slot casino, it is essential to consider the disadvantages as well. In this article, we will explore both the advantages and disadvantages of playing at an online slot casino to help you make an informed decision.
    One of the main advantages of playing at an online slot casino is convenience. With just a few clicks, you can access a wide range of slot games from your computer or mobile device. This eliminates the need for travel and allows you to play whenever and wherever you want. Whether you’re on your lunch break at work or relaxing at home, online slot casinos are available 24/7, ensuring that you can indulge in your favorite pastime at any time.

    Pos4d slot
    https://rsac.org

  12. Trần Bảo Nam được biết đến là người đứng sau sự thành công vang dội của thương hiệu Vin777 . Nhờ nền tảng học thức khủng cùng sự am hiểu thị trường, anh được xem là gương mặt tiêu biểu cho ý chí và óc sáng tạo, phát triển của con người Việt Nam. Để hiểu rõ hơn về chặng đường khởi nghiệp của chàng trai này, hãy cùng chúng tôi khám phá thông tin chi tiết qua bài viết sau.
    Sơ yếu lý lịch về chàng trai đa tài:
    Họ và tên đầy đủ: Trần Bảo Nam
    Ngày sinh: 22/12/1995
    Giới tính: Nam
    Quê quán: Đống Đa – Hà Nội
    Quốc tịch: Việt Nam, Philippines
    Trình độ học vấn: Thạc sĩ chuyên ngành khoa học máy tính của đại học quốc gia Hà Nội (có 3 năm du học tại Tokyo, Nhật Bản).

  13. Fine Posting, We’re an important believer around writing commentary for web pages so that you can allow the site freelancers realise that they’ve increased a little something valuable so that you can the ether! boost very high calorie

  14. Trần Bảo Nam được biết đến là người đứng sau sự thành công vang dội của thương hiệu Vin777 . Nhờ nền tảng học thức khủng cùng sự am hiểu thị trường, anh được xem là gương mặt tiêu biểu cho ý chí và óc sáng tạo, phát triển của con người Việt Nam. Để hiểu rõ hơn về chặng đường khởi nghiệp của chàng trai này, hãy cùng chúng tôi khám phá thông tin chi tiết qua bài viết sau.
    https://vin777pro.com/author/admin/
     

  15. Trần Bảo Nam được biết đến là người đứng sau sự thành công vang dội của thương hiệu Vin777 . Nhờ nền tảng học thức khủng cùng sự am hiểu thị trường, anh được xem là gương mặt tiêu biểu cho ý chí và óc sáng tạo, phát triển của con người Việt Nam. Để hiểu rõ hơn về chặng đường khởi nghiệp của chàng trai này, hãy cùng chúng tôi khám phá thông tin chi tiết qua bài viết sau.Sơ yếu lý lịch về chàng trai đa tài:Họ và tên đầy đủ: Trần Bảo NamNgày sinh: 22/12/1995Giới tính: NamQuê quán: Đống Đa – Hà NộiQuốc tịch: Việt Nam, PhilippinesTrình độ học vấn: Thạc sĩ chuyên ngành khoa học máy tính của đại học quốc gia Hà Nội (có 3 năm du học tại Tokyo, Nhật Bản).

  20. I might suggest almost any information. It really is superb to see you might reveal with text by heart as well as display quality by using precious information is reasonably purely known. 다낭 마사지

  21. Thanks for taking the time to discuss this, I feel strongly about it and love learning more on this topic. If possible, as you gain expertise, would you mind updating your blog with extra information? It is extremely helpful for me. Api33

  22. Nhà cái SKY88 với kho game đa dạng các trò chơi đổi thưởng như casino, thể thao, bắn cá, game bài, slot game,…

  24. Nhà cái Hi88 – link mới nhất không chặn , trải nghiệm mượt mà hỗ trợ Tiếng Việt giúp anh em có thể trải nghiệm dễ dàng , địa chỉ uy tín nhất 2023
    #hi88 #hi88casino #nhacaihi88 #Hi88betsco

  26. This is very incredible. I truly enjoyed it after reading it. I am here to share about esw. Are you or a loved one seeking independence and freedom in your daily life? Look no further! Welcome to ESW – your one-stop destination for top-quality wheelchairs that redefine mobility.

  27. SEXHAY là chủ đề được kích thích bởi các anh em với những cảnh nóng táo bạo của nhiều game hot girl. Xem ngay SEXHAY.LIFE nhanh thôi nào. 
    #sexhay #xemphimsexhay #sexhaymoingay #phimsexmoinhat 

  28. Nhà cái 789bet là địa chỉ giải trí cá cược hàng đầu của cộng động game thủ Việt. Sân chơi uy tín mang đến kho trò chơi đồ sộ như cá cược bóng đá, Baccarat.

  29. Nhà cái 789bet là địa chỉ giải trí cá cược hàng đầu của cộng động game thủ Việt. Sân chơi uy tín mang đến kho trò chơi đồ sộ như bóng đá, Baccarat.
    #789bet #nhacai789bet #789betcasino #789betvipblack 

  30. Vin777 tự hào là nhà cái uy tín hàng đầu châu Á. Cung cấp các thể loại cá cược thể thao, nổ hũ, đá gà, bắn cá,… cùng hàng trăm ưu đãi khác.
    #vin777 #vin777casino #nhacaivin777 #vin777newscom
     

  31. Microsoft Project has been an integral part of our project management toolkit. Its robust features and seamless integration within the Microsoft ecosystem make it a go-to solution for planning, scheduling, and executing projects of varying complexities. It’s impressive how it streamlines collaboration, allowing our team to stay on track and meet project milestones efficiently. For anyone seeking a comprehensive project management tool, Microsoft Project is definitely worth exploring further.”

    For more insights on leveraging Microsoft Project for project management success, check out Microsoft Project Crack

  34. Vin777 là thương hiệu sở hữu đa dạng các sản phẩm và dịch vụ chất lượng cùng nhiều tính năng nổi bật khác. Nhà cái hiện không ngừng cải tiến và hoàn thiện dịch vụ của mình qua từng ngày để đem lại trải nghiệm tuyệt vời nhất cho người chơi tham gia giải trí trực tuyến.#vin777 

  36. Trong thế giới cá cược trực tuyến, Vin777 đã nhanh chóng trở thành cái tên không thể bỏ qua. Được biết đến rộng rãi như một nhà cái đáng tin cậy tại châu Á, Vin777 không ngừng nỗ lực để mang đến trải nghiệm cá cược đỉnh cao cho người chơi.

  37. 123B mở ra một sân chơi giải trí online chất lượng tất cả bet thủ. Bạn sẽ được trải nghiệm thế giới cá cược có thưởng với đẳng cấp đỉnh cao, an toàn.#123b 

  38. 123B là nhà cái cá cược online uy tín hàng đầu thế giới hiện nay. Tham gia ngay để có cơ hội trải nghiệm các trò chơi về Thể thao, Xổ số,… đa dạng và hấp dẫn .#123b 

  42. Khám phá ngay thế giới cá cược trực tuyến đẳng cấp tại 123B, nơi được mệnh danh là nhà cái hàng đầu với uy tín vững chắc trên bình diện quốc tế. 

  43. The obWhatsApp application is considered safe for conversations, as it uses a strong encryption system to protect personal data and content that is exchanged between users.

  47. Vin777 tự hào là nhà cái uy tín hàng đầu châu Á. Cung cấp các thể loại cá cược thể thao, nổ hũ, đá gà, bắn cá,… cùng hàng trăm ưu đãi khác.#vin777 #vin777casino #nhacaivin777 #vin777newscom
    Xem Thêm Tại: https://vin777news.com/

  50. 789bet chính là thương hiệu game đình đám hàng đầu khu vực châu Á, ngày càng nhận được sự yêu thích của đông đảo thành viên. Nơi đây là thiên đường trong mơ.

Leave a Reply

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