Discount Department Stores
Companies in this industry operate physical retail establishments that sell a wide variety of merchandise, including apparel, household furnishings, and personal care products. Major companies include Kmart, Target, and Walmart (all based in the US), as well as Auchan Retail and Carrefour (both based in France), Daiso Japan (Japan), Lojas Americanas (Brazil), and METRO AG (Germany).
The global department stores market is expected to reach $930 billion by 2030, according to Global Industry Analysts. China is forecast to be the world's most penetrated e-commerce market in 2022, with nearly 50% of retail sales conducted over the internet; the UK (about 36%) and South Korea (about 32%) follow, according to Statista.
The US discount department store industry includes about 4,300 establishments (single-location companies and units of multi-location companies) with combined annual revenue of about $70 billion.
Unlike most traditional department stores, discount department stores typically have a central checkout at the front of the store. Discount department stores generally do not sell fresh, perishable foods, unlike supercenters and warehouse clubs. Some discount retailers, such as Target and Walmart, also operate supercenters or warehouse clubs, which are covered in a separate industry profile.
Competitive Landscape
Population growth and consumer spending drive demand. The profitability of individual companies depends on efficient supply chain management, effective merchandising, and competitive pricing. Large companies enjoy advantages in purchasing, distribution, and marketing. The US industry is highly concentrated: the 50 largest companies account for 100% of industry revenue.
Discount department stores carry a wide range of merchandise and compete with a diverse set of retailers, including department, drug, grocery, off-price, outlet, and specialty stores; warehouse clubs; and internet and catalog retailers. As consumers migrate to online purchasing, e-commerce has become a battleground for discount department stores and other retailers. However, the new Biden administration's security reviews have shelved the deal.
To better compete with Amazon and their brick-and-mortar rivals, discount department stores are connecting their physical and online operations to create new services such as next-day (and even same-day) delivery of online orders, as well as offering in-store pickup for online orders.
Products, Operations & Technology
Major products sold include women's clothing (about 30%), men's clothing (about 20%), cosmetics and fragrances (about 11%), footwear and footwear accessories
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Sales & Marketing
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Finance & Regulation
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Regional & International Issues
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Human Resources
Also includes the following chapters:
Quarterly Industry Update
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Industry Indicators
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Business Challenges
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Trends and Opportunities
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Call Preparation Questions
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Financial Information
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Industry Forecast
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Industry Websites
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Glossary of Acronyms