An American business owner talks about the department store industry
Last night, I chatted with an American business owner, and he revealed a piece of news that made me feel that the logic of doing business has completely changed!
He said that the retail business in the United States is not doing well now, and there are constant news of department store closures, even Macy's has been reported to be closing stores. But it is worth noting that there are also retail companies in the United States that have become exceptions. TJX, a company specializing in discounts on clothing and home furnishings, has a sales volume of 400 billion a year, with a market value of more than 900 billion. It is still accelerating the opening of stores and is known as the offline version of Vipshop in the United States.
This is very strange. Why is TJX's business still good when other retail businesses are not doing well? My friend said that it is actually a change in consumer concepts. Now many American consumers no longer pursue low prices purely in terms of numbers, but pursue low prices while also paying attention to brand quality and service.
TJX has a large number of selected, high-quality brand products on the shelves every week, which can be discounted by 40% to 80% on the basis of other traditional department stores. You know, these are all discounts based on the brand, and TJX's service is also very good. For current American consumers, what they want is not pure cheapness. In our words, it is okay to buy expensive things, but not too expensive.
Back to the domestic retail industry, this consumption trend has actually slowly emerged. In June this year, major platforms such as Alibaba, JD.com, and Vipshop began a round of redefinition of "low price". Suddenly, everyone no longer emphasizes pure low prices, but adds services and quality control. For example, JD.com continues to increase logistics services, and can provide three door-to-door visits for one consumption. Vipshop continues to insist on pulling SF Express to exchange goods at home, and on the other hand, it cooperates with China Inspection to ensure quality.
Although TJX is the offline version of Vipshop in the United States, the domestic Vipshop is indeed far behind it. Although the latter can also sell 200 billion a year, which is half of TJX, its market value is only one-seventeenth of that. But it is worth noting that although the gap is large, the latter has been a domestic first-tier e-commerce for so many years. Although the size is small, it has high stickiness and is relatively stable.
It can be seen that the trend of domestic consumption is also very obvious. The brand discount market is relatively niche, because many domestic consumers would ask, "I already buy branded products, why do I need discounts?" However, such misunderstandings will gradually be dispelled, and the consumer concept of pursuing both quality and cost-effectiveness is spreading!