Department Store Retailing - Germany - January 2005

EXECUTIVE SUMMARY – GERMANY
Mixed goods sector struggling
Two leading players
Shortcomings…
…and survival strategies
Mixed goods sector to continue struggling
EUROPEAN SUMMARY
European mixed goods retailing sector
Sector value and trends
Figure 1: European mixed goods retailing: Sector sales by country, 1999 and 2004e
Leading retailers
Ranked by sales
Figure 2: Leading European department store retailers: Ranked by sales, 2003
M&S, a hybrid operator, leads the rankings
Winners…
…and losers
Figure 3: Leading European department store retailers: Sales performance, 1999 vs 2003
Huge variation in sales densities
Figure 4: Leading European department store retailers: Ranked by estimated sales densities, 2003
M&S in pole position
Luxury stores excel
Full assortment also delivers good productivity
But German, Dutch and some smaller British operators underperform
Outlets and space
Figure 5: Leading European department store retailers: Outlet numbers and space, 2003
New store development
Corporate activity – 2003 and 2004
Figure 6: European department store retailers: Major acquisitions, 2003
Moving to private ownership
2004
Some product and marketing trends
Targeting younger shoppers
Menswear enjoys more attention too
Foodhalls gaining popularity
Flexing the mix to chase gross margins
More focus on own-label
Smaller UK players follow the trend too
Vroom & Dreesman consolidates its own-label
International and retail brands still key for some
Themed events
E-commerce
Figure 7: Leading European department store retailers: E-commerce facilities, 2004
Customer loyalty schemes
Loyalty schemes become more commonplace
But do they create genuine ‘emotional loyalty’
Figure 8: European department stores: Loyalty schemes, 2004
EUROPEAN OUTLOOK
Upcoming corporate activity
Italy in a state of flux
Allders for sale…
…and Karstadt scales back in Germany
Store plans
Figure 9: European department store retailers: Planned openings and closures
But are property assets worth more than trading operations?
Figure 10: European department stores: Leading retailers sales and profits performance, 2003 vs 2002
Sector sales forecasts
Figure 11: European mixed goods retailing: Sector sales and forecasts by country, 2004 and 2009
Figure 12: Mixed goods retailers as % all retailer sales, 1995-2009f
Figure 13: Sector sales growth forecast, by country, 1999-2004e, 2004e-09F
REPORT SCOPE
2005 content change
The sector
Department store definition
Countries and companies covered
Accounting policy
BACKGROUND DATA – GERMANY
Population
Figure 14: Germany: Population trends, 1999-2003
Figure 15: Germany: Population, by age group, 1999-2003
Figure 16: Germany: Households, 2000-02
Figure 17: Germany: Regions and major cities, 2002
Economy
Figure 18: Germany: Gross domestic product, 1995-2003
Figure 19: Germany: Consumer prices, 1997-2003
Figure 20: Germany: Consumer expenditure, 1995-2003
Figure 21: Germany: Detailed breakdown of consumer expenditure, 1999-2003
MIXED GOODS RETAILING IN GERMANY
Background
A mature and concentrated sector
Corporate activity slows down
Competing in a discount-led market
 SECTOR VALUE AND TRENDS
Figure 22: Germany: Mixed goods retailers’ sales, 1999-2004e
Figure 23: Germany: Mixed goods retailers, relative performance, 1999-2004
 OUTLET AND ENTERPRISE DATA
Figure 24: Germany: Mixed goods retailers – number of enterprises, 1997-2001
Figure 25: Germany: Department and variety stores, sales and outlets, 1995-2000
 PRODUCTS
 MIXED GOOD RETAILERS IN SHOPPING CENTRES
Figure 26: Germany: Major shopping centres, 2004
EUROPEAN CONSUMER TRENDS
Figure 27: Europe: Department store visiting patterns, 2004
Figure 28: Europe: Usage of department stores, by age, 2004
Success with younger customers
Figure 29: Europe: Breakdown of department store customers, by age, 2004
GERMANY CONSUMER TRENDS
Figure 30: Penetration and profile of consumers who have been in a department store in the last three months, Germany, 2002 and 2004
Figure 31: Shopping at department stores in last three months, Germany, 2004
LEADING PLAYERS
Figure 32: Germany: Leading mixed goods retailers, 2003
Market shares
Figure 33: Germany: Leading mixed goods retailers, market shares, 2003
PROSPECTS AND FORECASTS
Figure 34: Germany: Mixed goods retailers’ sales, 2004-09f
Figure 35: Germany: Mixed goods retailers, relative performance, 1999-2009f
MAJOR COMPANY PROFILES
 GROUPE GALERIES LAFAYETTE
Market share
Figure 36: Groupe Galeries Lafayette department stores: Sales as % all French mixed goods retailers sales, 1999-2003
Background
History and ownership
Group structure and activities
Completes acquisition of BHV
M&S French operations acquired
Joint control of Monoprix
Launches homewares standalone format
Financial data
Figure 37: Groupe Galeries Lafayette: Financial performance, 1999-2003
Galeries Lafayette/Nouvelles Galeries
BHV
Monoprix
Figure 38: Monoprix: Financial performance 1999-2003
Improved performance in 2004
Outlets
Figure 39: Groupe Galeries Lafayette: Outlet data, 1999-2003
Galeries Lafayette/Nouvelles Galeries
BHV
Monoprix
Products
Galeries Lafayette/Nouvelles Galeries
Figure 40: Galeries Lafayette/Nouvelles Galeries, estimated sales mix, 2003
BHV
Monoprix
Systems and distribution
International activities
E-commerce
SWOT
 KARSTADT
Market shares
Figure 41: Karstadt department store division: Share of German mixed goods retailers’ sales, 1999-2003
Background
History
2003+ replaces the 10-step programme
The 2004 reorientation
Karstadt division
Corporate structure and planned changes
Figure 42: KarstadtQuelle: Sales by division, 2002 and 2003
Figure 43: KarstadtQuelle: Profits (a) by division, 2003
Financial data
Figure 44: Karstadt department stores division: Financial performance, 1999-2003
Interim results
Outlets
Figure 45: Karstadt department stores: Outlet data, 1999-2003
Store types
Products
Own brand
Discounts and promotions
Product mix
Figure 46: Karstadt: Department stores division, sales by product, 2002 and 2003
Loyalty card
E-commerce
SWOT
 KAUFHOF
Market shares
Figure 47: Kaufhof: Share of German mixed goods retailers sales, 1999-2003
Background
Cash & carry
Focus on the core
Figure 48: Metro Group: Sales by division, 2002 and 2003
Kaufhof in Germany…
…and testing waters overseas
Group economies of scale
Financial data
Figure 49: Kaufhof: Financial performance, 1999-2003
2004 interim results
Outlets
Figure 50: Kaufhof: Outlet data, 1999-2003
Galeria Kaufhof
Inno
Smaller brand stores
Products
Product mix
Top brands and own-brands
Theme shopping
Autonomy for brand stores
Loyalty card
E-commerce
SWOT
MINI COMPANY PROFILE
Breuninger
Background
Financial data
Figure 51: Breuninger: Financial performance, 1999-2003
Outlets
Products