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.

287,772 thoughts on “Department Store Industry

  1. dual fuel range cookers
    The Benefits of a Dual Fuel Range

    Dual fuel ranges are a fantastic option for cooks who want the preciseness of a gas stove and oven. They require gas and power supply, making them more difficult to install than professional ranges that are all-electric or all-gas.

    Alternatives include putting in an additional gas cooktop as w

  2. ag-881 inhibitor
    Conclusions Degenerative disease of the intervertebral disk continues to be an important health problem. Besides standard conventional and medical procedures, practices of regenerative treatment are becoming very encouraging, although nonetheless when you look at the experimental stage. © 2019 Natasa Kos, Lidija Gradisnik, Tomaz Velnar.Introduction Injurie

  3. official statement
    The Benefits of Using a Smart Robot in the Workplace

    A smart robot can perform many tasks, like monitoring and interacting humans. This type of robot is used in a variety of applications, such as healthcare and home automation.

    A robot that is intelligent can adapt to changing conditions. It utilizes recognition results to alter its prog

  4. Pastor Chris Miracles
    Rumours of a remarriage have been circulating due to the divorce of Pastor Chris Oyakhilome, and Anita Ebhodaghe.

    2014 brought the end of a love story which appeared to be straight from an old fairytale. Pastor Chris Biography After 23 years of marriage, two

  5. comfortable affordable couches
    One Of The Most Comfortable Take Out Couch

    Whether you’re trying to find something relaxing to lounge on or a queen-size sleeper to accommodate over night guests, there’s something for every budget plan. We’ve assembled the most comfortable pull out couch alternatives.

  6. best inexpensive robot vacuum
    Best Robot Vacuum Cleaner UK

    Robot vacuum cleaners are ideal for those who don’t like to get your hands messy. They are more efficient than manual vacuum cleaners and are ideal for flats and single-storey houses.

    Smart features are a plus. They include mapping technology that remembers your home layout, avoidance of rugs and furniture, and avoiding tho

  7. electrician cambridge
    If you don’t already have some, install some ceiling fans in all your rooms. You can use these to cool rooms and circulate the air, reducing the need to use your air conditioning unit. in turn will save you money on your electric bill and most likely increase the life expectancy of your air conditioner.

    Make sure that you keep an eye out for a

  8. robot vacuum
    Robot Vacuum Cleaner Black Friday Deals

    If you want to save time on housework, a robot vacuum cleaner is an absolute game-changer. These small machines vacuum up pet hair, crumbs and dust while prioritizing the more messy rooms.

    For those on a tight budget, they can go for an entry-level mo

  9. convertible crib sets Cots For Tots
    The Best Convertible Crib With Mattress

    A crib is a big investment for a new parent. It needs to look stunning, be simple to tidy and last through infancy and beyond. The finest convertible crib with mattress will be elegant, resilient and safe.

    It should also be consciously crafted. The very be

  10. fabric 3 seater sofa
    Buying a 3 Seat Fabric Sofa

    A 3 seat fabric sofa is the perfect option for a modern or standard living-room. It is also a fantastic option for smaller areas that can not accommodate a large sectional.

    The makeup of a fabric’s thread can tell you a lot about how it will feel and hold up to wear. Try to find a tight weave tha

  11. MIE GORENG, INDOMIE GORENG, MIE MURAH
    menanti dalam waktu yang lama , karena di laundry PGSAFTY sudah tersedia jasa WASH AND DRY

    2. Apa saja fasilitas yang di bagikan oleh Loundry PGSAFTY ?

    Selain mencuci , Mereka juga membagikan fasilitas berupa detergen gratis , pewangi gratis , seterika gratis , melipat gratis dan juga metode mencuci bersih dan selesai dalam waktu 1 jam , selain itu Loundry PGSAFTY juga buka dengan w

  12. EpigeneticReaderDo signals
    A drug screening promotion revealed that the β2-adrenergic receptor (β2-AR) agonists clenbuterol hydrochloride (CLEN) and salmeterol xinafoate (SALM) increase the expansion price of neural progenitor cells through the Ts65Dn model of DS. The goal of the existing research was to establish their particular efficacy in vivo, within the Ts65Dn model. We unearthed

  13. most comfortable pull out couch
    How to Choose a Super Comfortable Couch

    We enjoy this sectional for its loungey low profile and squishy cushions. It likewise has a strong, furniture-grade plywood frame and is made with recyclable materials.

    A best-seller, this couch seems like napping on a

  14. https://aquaxbet.me/

    Tiền thưởng sòng bạc Nó hứa hẹn sẽ mang đến cho người chơi những giây phút giải trí vô tận và cơ hội giành giải thưởng. Trong vài năm qua Ngành công nghiệp sòng bạc toàn cầu đã trải qua một sự thay đổi lớn đối với các nền tảng trực tuyến. Với sự tiện lợi và khả năng truy cập internet khiến ngày càng nhiều người chuyển sang sử dụng Sòng bạc hoàn chỉnh với cá cược để đáp ứng nhu cầu cờ bạc của họ. Tuy nhiên, khi mức độ phổ

  15. führerschein kaufen legal in deutschland
    How to Buy a Real German Driving License

    Getting an German driving licence may seem like an enormous task. The good thing is that it doesn’t need to be!

    Renewal is simple in Germany You just need to visit your local Fuhrerscheinstelle 4 weeks before the expiration date of your current licen

  16. add treatments for adults
    Add Treatment For Adults

    Adults with add/adhd might not show as many symptoms as children, however the condition affects them in a significant manner. The use of stimulants is often considered the first line of treatment. They can enhance academic performance, improve social and memory fun

  17. her response
    Buy a Driving License Without an Exam

    A driver’s license is one the most important cards you have in your wallet. It is used to verify your identity at checkpoints and other times when you may need to present proof of age.

    To be able to obtain a license, you must meet the eligi

  18. gas engineer buckingham
    Choosing Gas Fitters in Buckingham

    When you need a plumbing professional in Buckingham, make sure you choose one with the ideal certifications. These plumbing professionals can deal with everything from fixing a leaking tap to setting up new boilers and heating systems.

    A woman found Goldthor

  19. find more information
    Robot Vacuum Cleaner Reviews

    Robot vacuums are typically less powerful than the larger vacs. They also have smaller bins, which require emptying more frequently.

    They can be stuck on furniture legs or struggle to navigate stairways or thresholds. If you choose a model with no-go zones on th

  20. adhd treatments adults
    add treatments for adults and Untreated in Adults

    Untreated ADHD in adults can lead to many issues. These include persistent tardiness, inability to keep track of time and unpredictable behavior. It can also cause unstable relationships and job loss.

    There are ways to

  21. range cookers
    Commercial Dual Fuel Range Cookers

    Dedicated cooks admire gas ranges for their responsive temperature control, but some homeowners prefer the precise baking and roasting provided by electric ovens. Dual fuel ranges combine the stovetop of a gas with an oven to satisfy both preferences.

    ILVE offers dual fuel that blend the power

  22. http://www.cots4tots.co.uk
    White Cot That Develops Into Bed

    If you’re trying to find a white cot that turns into bed, this simple, elegant solid-wood number might be the one. It’s easy to put together and has a few extra features, including a helpful drawer beneath and three mattress base heights.

    Our parent testers enjoyed how durabl

  23. index
    Picking a 3-Seater Sofa Brown Fabric

    All of us have that buddy sofa that uses comfort when you need it, rest when you’re tired and friendly assistance at the drop of a hat. Our brown fabric sofas provide a warm and inviting vibe with durable luxurious upholstery and strong eucalyptus wood frames.

    Be

  24. robot vacuum cleaner
    A Robot Vacuum Cleaner Review

    A robot vacuum can assist you achieve more by removing items from your to-do list. It’s important to keep in mind that robots aren’t a wholesale replacement for a normal, full-size vacuum.

    The dustbins of robot vacs are smaller than those of traditional vacs, so they require emptying more often. Look for models with self-

  25. robot vacuum cleaner amazon
    How to Properly Maintain a Robot Vacuum

    Robot vacuums excel in routine midweek cleanups and can be especially helpful for households with pets and children. They’re not a substitute for the use of a plug-in vacuum.

    You can modify the cleaning settings of several robot mop

  26. zeegame

    เว็บไซต์คาสิโนต่างถิ่น ในโลกที่เปลี่ยนอย่างเร็วในขณะนี้ ับในการใช้งานนับว่าเป็นสิ่งจำเป็นเมื่อกล่าวถึงบริการหรือสินค้าใดๆก็ตามรวมทั้งการเดิมพันออนไลน์ นี่เป็นจุดที่ เว็บคาสิโน100% ของพวกเรามีความเป็นยอดเยี่ยม ด้วยต้นแบบที่เรียบง่ายแล้วก็ใช้งานง่าย ผู้ใช้สามารถไปยังส่วนต่างๆของไซต์ได้อย่างง่ายๆ ไม่ว่าคุณจะเป็นผู้เล่นที่มีประสบการณ์หรือพึ่งจะเริ่มไปสู่โลกของคาสิโนออนไลน์ อินเทอร์เฟซของเว็บได้รับการ

  27. brera gaggia
    Gaggia Brera Bean-To-Cup Coffee Machine

    The Gaggia Brera is a bean-to-cup coffee machine that is capable of making espresso, latte and cappuccino. It has a thermoblock boiler and is simple to tidy.

    It is easy to utilize and has a great design. It can likewise dispense hot water for t

  28. mouse click for source
    Gaggia Brera Super Automatic Espresso Machine Review

    The Gaggia brera is a great choice for anybody who likes coffee. It can brew espresso and milk-based drinks with ease. It has a simple user interface and is easy to tidy. It likewise comes with a 1-year service warranty.

    It’s easy to utilize, with push-button controls and an LED dis

  29. adhd treatment in adults
    ADD and Treatment

    ADD and its treatment are frequently associated with problems at school, work, or at home. The psychiatric condition is often difficult to identify and manage.

    Attention deficit hyperactivity disorder (ADHD) is the most commonly used term for this psychiatric condition. Mental health professionals employ brain imaging using SPECT to diagno

  30. most comfortable pull out couch
    A Comfortable Reclining Couch

    The sofa sets the stage for a room, so you require one that looks excellent and feels fantastic. The excellent news: A comfy reclining couch doesn’t need to spend a lot.

    This contemporary pick from West Elm fits the costs. Its smooth silhouette conceals po

  31. cellbasedassayblog
    This work presents initial global characterization of TRT-induced modifications regarding the antitumor immune response, demonstrating that tolerance is a main protected escape system and that combining TRT and ICI is promising.Humans are extraordinarily skilled when you look at the tactile analysis of, and differentiation betwee

  32. fabric 3 seater couch
    Fabric Sofa Bed 3 Seater

    Elegant and practical, the fabric sofa bed 3 seater adds additional sleeping space to your home. Providing ample seating for family motion picture nights, it easily changes into a glamorous double bed to accommodate over night guests. Its tidy lines and effortless design complement any décor. Its bench seat and loo

  33. Read Far more
    Find the very best Car Locksmith in Bedfordshire

    Whether you’re searching for a locksmith to change locks on your home or car, you can find the best one in bedfordshire. These companies use a variety of services at inexpensive costs.

    Bedfordshire’s welcoming communities mix custom with cont

  34. wikipedia clothes
    Should the product not be up to snuff, you can get your money back. In other words, there’s a transparent use for replicas in a authorized sense once they aren’t marketed as the real deal, nevertheless, that isn’t all the time the case. Prada, Armani, RayBans, what do all these brands have in common?

    <

  35. gas safety buckingham
    Gas Safe Engineer in Buckingham

    A gas safe engineer in buckingham is a tradesperson who needs to be signed up with the Gas Safe Register to legally work on gas home appliances. They are trained and qualified to work with piped natural gas and liquefied petroleum gas (LPG).

    The register safeguards house owners, occupa

  36. brera gaggia
    Gaggia Brera Super Automatic Espresso Machine Review

    The Gaggia brera is an excellent choice for anyone who likes coffee. It can brew espresso and milk-based beverages with ease. It has a simple interface and is easy to clean. It likewise comes with a 1-year warranty.

    It’s simple to utili

  37. gas hot water systems
    Make sure you know where your home’s water shutoff is located. You never know when there might be an emergency involving a broken pipe or damaged connection that requires you to turn off the water right away. In , knowing where the shutoff is located is vital before you start any plumbing project, in case anything goes wrong.

    To winterize a house that will sit unused during the winter months,

Leave a Reply

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