2016-2018 Shang Hai Retail Market Development Tendency--Retail

2015-12-22

2015-12-22

Ladies and gentlemen, under the double pressure of the new normal economic and Internet +, Shanghai retail market will seek to break through the old forms and appear new industries in 2016. And in 2017, the entity retail stores seek the way but not make thorough improvements in economic benefit and have to persist in the year. And the once glorious retailing industry will continue to consume capital because they make no effort to seek progress. 2018 will be the year that we go through all the hardship and welcome the glorious of new retailing.

There have big changes during the 3 years, not only the object description to the old Shanghai buildings, but also apply for the entity retail managers.

PIONEER is a just small private institution which is specialized in retail and commercial real estate consulting. Why we have so much courage to say these about future market is based on 2 points:

I. We get all the achievements from zero to 8 years (2008-2015). The eight years it is an economic turning point (the global financial crisis of 2008), obviously downward trend and was delayed by the booming domestic commercial real estate.

II. From my work experience from 1991-1997, I witnessed that transformation period: China’s development from individual shop street to focus on trade and wholesale trade. Later from 1999-2007, developed its business in world top 500 retail industry. And promote the quick development of advanced retail industry.

We can say that without the impact of foreign capital retail business, there will not have the prosperity of today. But the most direct statement is that in 2016-2018, these enterprises that still cannot learn how to manage them after China’s entering into the WTO for 15 years will be abandoned by the market.

Here I will not touch the specific industry, only point out common fault of enterprises:

1. No standardized management (What? Don't know what the standard management is?!)

2. No core products (More than 10% of the total commodity) and profitable shop (Accounted for over 50% of the scale of stores)

3. The enterprise operators and managers don't realize that risk in the future, and just repeat the old methods.

These enterprises follow the survive law, it will get new-born:

1. Have true team cohesiveness (2 people or 200 people) with the core values;

2. Have annual development plan and have the courage to pay and implementation to the plan;

3. Accumulate step by step and achieve its goals.

Here industries involved in covers: fashion, F&B, service and entertainment, quality of life, experience, 55 sub formats of 7 virtual formats, covering retail entity industry. (Here temporarily not to refer to Tao Bao shop operators, we don’t look good at it.)

Retail that must go disappear (Survive by its abundant upfront capital, but its disappearance is inevitable):

Large retail supermarket (Not including wholesale), all kinds of over-the-counter makeup shop, local fresh supermarket, clothing store, light a luxury retail stores, fast food chain properties/casual dining/coffee shop, adult traditional entertainment city, low grade of textiles/daily provisions wholesale market, etc.;

The retail industry cannot avoid of quick disappearance:

Upscale casual dining/coffee shop, business center, non-traditional luxury and pretentious luxury shops, fashion furniture stores, private sale type gallery, luxury clothing store chain, unnecessary flagship store that beyond the standard of management & control (e.g., Huai Hai Rd./Rui Jin 2nd Rd., newly opened MUJI flagship store), etc.;

The enterprises that prospected to succeed:

Positioning precision, adhering to the small light dining/coffee casual dining chain stores, fashion shop that combined with online and offline, the imported products MD but with compact small compact chain store, high technology product with no alternative, small and medium size chain supermarkets, restaurant chains store with distinctive features dishes and service, high level industry/service .

Without 2016, there will be no retail emperor dream, let’s expecting the reconstruction of Shanghai retail industry and the new-born emperor.

Writer: Louis Wu