With the rise of ever-larger shopping malls in Taiwan and in China, department store operators have to either follow the trend or concentrate on other factors to boost their competitiveness.
Far Eastern Department Stores Ltd (FEDS) (遠東百貨), the retail and department store arm of the Far Eastern Group (遠東集團), is ready to relaunch its Banciao store (板橋遠百) tomorrow after months of renovation work.
It has been the largest-scale renovation work since the company established the branch 15 years ago, and has been a multimillion dollar investment for the department store.
FEDS started renovations of the Banciao store in March on a floor-by-floor and a section-by-section basis, aiming to offer more public spaces with green areas and seats, as well as building special sections for women’s apparel, accessories and beauty and skin care products.
“We focused the renovations on the urban female customer base,” store manager Lin Chang-li (林彰豊) told a media briefing yesterday.
The store is set to launch a 12-day sales campaign for the re-opening from tomorrow through July 27, setting a growth target of between 50 and 80 percent compared with the same period last year.
With the renovations, FEDS expects the Banciao Store’s annual revenue to total NT$4 billion (US$133.33 million) next year, from the NT$3.8 billion recorded last year, Lin said.
The company had seen annual sales at the Banciao Store hit NT$5 billion previously, but the store has failed to post the same level of revenue over the past few years, mainly due to the impact of nearby Mega City (板橋大遠百). FEDS launched Mega City — one of its “City” series of shopping malls — in 2011, with the location very close to its Banciao Store.
Huang Jou-chieh (黃榮杰), a department chief at FEDS’ Banciao Store, said the company’s move reflected the popularity of shopping malls in Taiwan’s retail sector, as an increasing number of people prefer to do their leisure activities in the same place, whether they enjoy shopping, going to the movies or dining out.
That meant traditional department stores, such as the Banciao Store had to transform the services offered or concentrate on a particular customer group, Huang added.
Facing the same scenario in China, Grand Ocean Retail Group Ltd (大洋百貨集團) has also had to reflect current trends to maintain the momentum of its sales growth and profitability.
Despite shutting down three outlets, the department store operator saw consolidated sales up by 5.18 percent to NT$3.78 billion (US$126 million) in the first six months from a year earlier, thanks to its efforts to continue increasing revenue from food, beverage and entertainment.
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