Off the rack: Continued online retail growth is forecast to contribute to industry declines

The Department Stores industry has continued its long-term decline over the five years to 2017. While rising competition from e-commerce has accelerated declines, revenue contraction is primarily attributable to the increasing number of major players that have expanded their product range to include groceries, which transitions their revenue to the Warehouse Clubs and Supercenters industry (IBISWorld report 45291). This trend is expected to continue through 2017. Over the five years to 2022, increased competition from e-commerce businesses and the continued transition of department stores to supercenters will pressure industry revenue. However, improved consumer spending and disposable income will encourage spending at department stores, which will offset some of the period's declines...read more.

Industry Statistics & Market Size
Revenue
$156bn
Annual Growth 12-17
-4.0%
Forecast Growth 17-22
Profit
Employment
996,442
Businesses
7,984

Industry Threats & Opportunities

  • Rising competition from e-commerce has accelerated industry declines
  • The industry has lost revenue in recent years due to the prevalence of online shopping
  • High consumer spending levels will aid traditional department store sales
  • Industry Report - Industry Products Chapter

    While this industry is segmented into two distinct types of operators (up-market department stores and their discount variety counterparts), both types of stores retail a wide assortment of general merchandise. IBISWorld categorizes industry products into five groups: apparel, drugs and cosmetics, furniture and household appliances, toys and hobby goods and other products.Apparel and footwearThe industry predominantly sells men's, women's and children's clothing, shoes and accessories, with an estimated 51.4% of total sales generated from this product group. Over the past five years, apparel and footwear sales have somewhat increased as a share of industry revenue because many consumers opt to purchase these items in store, rather than online. Man...purchase to read more.

    Additional Insights for the Department Stores Industry

    IBISWorld identifies 250 Key Success Factors for a business.The most important for the Department Stores Industry are

  • Ability to control stock on hand
  • Experienced work force
  • Ability to expand and curtail operations rapidly in line with market demand
  • IBISWorld analysts also discuss how external factors such as Percentage of services conducted online and Import penetration into the manufacturing sector in the Department Stores industry impact industry performance..

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    What's in this report

    What is the Department Stores Industry?

    Department stores retail a broad range of general merchandise, such as apparel, jewelry, cosmetics, home furnishings, general household products, toys, appliances and sporting goods. Discount department stores, which are also included in this industry, retail similar lines of goods at low prices. However, big-box retailers and supercenters that offer fresh groceries in their stores, as well as warehouse clubs that operate under membership programs, are not included in this industry.

    Industry Products
  • Women's clothing and footwear
  • Men's clothing and footwear
  • Home goods and appliances
  • Drugs and cosmetics
  • Children's clothing and footwear
  • Toys and hobbies
  • Nongrocery food items
  • Industry Activities
  • Retailing apparel and accessories
  • Retailing appliances and home furnishings
  • Retailing toys and sporting goods
  • Retailing other general merchandise
  • Table of Contents

    Industry Definition
    Main Activities
    Similar Industries
    Additional Resources
    Industry Statistics Snapshot
    Industry Structure
    Executive Summary
    Executive Summary
    Key External Drivers
  • Percentage of services conducted online
  • Import penetration into the manufacturing sector
  • Per capita disposable income
  • Time spent on leisure and sports

  • Current Performance
  • Supercenter conversion
  • Online competition
  • Profit and marketing
  • Chart: Revenue Growth

  • Industry Outlook
  • Conditions and competition
  • Industry structure
  • Table: Department Stores Industry Revenue Outlook

  • Industry Life Cycle
  • Life cycle reasons
  • Chart: Benchmarking - Department Stores Industry Lifecycle vs The Economy

  • Supply Chains
    Key Buying Industries
  • Consumers

  • Key Selling Industries
  • Ceramics Manufacturing
  • Footwear Wholesaling
  • Hardware Manufacturing
  • Household Furniture Manufacturing
  • Major Household Appliance Manufacturing
  • Manufacturing
  • Men's & Boys' Apparel Wholesaling
  • Shoe & Footwear Manufacturing
  • Vacuum, Fan & Small Household Appliance Manufacturing
  • Women's & Children's Apparel Wholesaling

  • Products & Services
  • Women's clothing and footwear
  • Drugs and cosmetics
  • Home goods and appliances
  • Men's clothing and footwear
  • Children's clothing and footwear
  • Nongrocery food items
  • Toys and hobbies
  • Other
  • Chart: Department Stores Industry Products and Services Segmentation

  • Demand Determinants
    Major Markets
  • Consumers aged 26 to 45
  • Consumers aged 46 to 65
  • Consumers aged under 25
  • Consumers aged over 65
  • Chart: Major Market Segmentation for the Department Stores Industry

  • International Trade
    Business Locations
    Chart: Business Locations by State
    Market Share Concentration
    Key Success Factors
    Cost Structure Benchmarks
    ProfitPurchasesWagesRent and utilitiesDepreciationMarketing and other costs
  • Chart: Cost Structure Benchmarking – Sector vs Department Stores

  • Basis of Competition
    Internal competitionExternal competition
    Barriers to Entry
  • Table: Barrier to Entry Checklist for the Department Stores Industry

  • Industry Globalization
    Target Corporation, Macy's Inc., Sears Holdings Corporation, Wal-Mart Stores Inc., Nordstrom Inc., J.C. Penney Company Inc.,
  • Table: Target Corporation - financial performance
  • Table: Macy's Inc. - financial performance
  • Table: Sears Holdings Corporation - financial performance
  • Table: Wal-Mart Stores Inc. - financial performance
  • Table: Nordstrom Inc. - financial performance
  • Table: J.C. Penney Company Inc. - financial performance

  • Capital Intensity
  • Chart: Level of Capital Intensity for the Department Stores Industry
  • Chart: Tools of the Trade: Growth Strategies for Success

  • Technology & Systems
    Revenue Volatility
  • Chart: Volatility vs Industry Growth

  • Regulation & Policy
    Industry Assistance
    Table: Industry Data for the Department Stores Industry
    Includes:
  • Industry Revenue (2008-2022)
  • Industry Gross Product (2008-2022)
  • Establishments (2008-2022)
  • Businesses (2008-2022)
  • Employment (2008-2022)
  • Wages (2008-2022)
  • Per Capita Disposable Income (2008-2022)

  • Table: Annual Percentage Change for Key Industry Data
    Table: Key Ratios for Industry Key Data
    Table: Industry Financial Ratios
    Big-Box Retailer
  • A relatively new store format characterized by its large size. These stores sell similar merchandise as department stores, but also include grocery items. Also referred to as supercenters.
  • Black Friday
  • The day following Thanksgiving Day in the United States. It traditionally marks the beginning of the Christmas shopping season and thus many retailers host sales with heavy discounts.
  • Brick-And-Mortar
  • A store that has a physical presence and location, as opposed to an online retailer.
  • Point-Of-Sale (Pos)
  • A system used at checkout in retail stores using computers and cash registers to capture transaction data at the time and place of sale.
  • Radio Frequency Identification (Rfid)
  • A technology that tracks products from the time they leave the assembly line to the time they leave the store by releasing continuous signals from a chip.
  • What Our Customers Say

    Why buy this report?

    IBISWorld’s Department Stores Industry Research Report offers insight into the market at the national level. Our analysis highlights macro trends in the overall sector and the micro trends faced by companies that do business in the Department Stores industry. Our five-year outlook forecasts explain how the market is set to change and the product segments that will drive growth.

    IBISWorld industry market research reports enable you to:
    • Find out about key industry trends
    • Identify threats and opportunities
    • Inform your decisions for marketing, strategy and planning
    • Quickly build competitive intelligence
    This report on Department Stores:
    • Provides Market Size information to assist with planning and strategic decisions.
    • Includes the necessary information to perform SWOT, PEST and STEER analysis.
    • Helps you understand market dynamics to give you a deeper understanding of industry competition and the supply chain.
    • Analyses key performance and operational metrics so that you can benchmark against your own business, that of your customers’ businesses, or your competitors’ businesses.
    The Department Stores market research report includes:
    • Historical data and analysis for the key drivers of this industry
    • A five-year forecast of the market and noted trends
    • Detailed research and segmentation for the main products and markets
    • An assessment of the competitive landscape and market shares for major companies
    • And of course, much more

    IBISWorld reports on thousands of industries around the world. Our clients rely on our information and data to stay up-to-date on industry trends across all industries. With this IBISWorld Industry Research Report on Department Stores, you can expect thoroughly researched, reliable and current information that will help you to make faster, better business decisions.

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