Shopping around: Profit margins are being squeezed as customers hunt for bargains

IBISWorld’s Department Stores in New Zealand market research report is a comprehensive guide to market size and growth prospects. Our industry reports offer strategic industry analysis of the factors influencing companies, including new product developments, economic, lifestyle and demographic influences, distribution and supply chain factors and pricing issues. Full analysis accompanies our data forecasts to illustrate how the market responds to emerging industry trends.


Industry Analysis & Industry Trends

The Department Stores industry has exhibited steady growth over the past five years. Trading conditions across the industry have been supported by positive consumer sentiment and increasing real household discretionary income. However, growing competition among department stores, external players and the online market has reduced industry profitability. The entry of specialist international retailers such as H&M and Zara has further heightened competition in the market. Industry revenue is expected to post annualised growth of 3.4% over the five years through 2017-18, to reach $5.0 billion.

Over the past five years, ongoing declines in the cash rate have reduced debt repayments and provided consumers with more money to spend on discretionary purchases...

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Industry Report - Industry Investment Chapter

The industry exhibits medium capital intensity. In 2017-18, for every dollar spent on capital, $7.90 is spent on wages. Department store staff are required to perform roles such as customer assistance, visual merchandising, processing transactions, stock management, and back-office and administrative duties. The industry is therefore regarded as being labour-intensive. Increasing competition from online retailers over the past five years has led department stores to place greater focus on customer service as a point of differentiation. As a result, wage costs as a share of industry revenue have increased over this period.

Capital costs for the industry come in the form of expenditure on store fixtures and fittings, and technical equipment such as point of sale systems. Ove..

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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
  • Superior financial management and debt management
  • Having a clear market position
  • IBISWorld analysts also discuss how external factors such as Real household discretionary income and Consumer sentiment index in the Department Stores industry impact industry performance..

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    New Zealand Special Report

    Industry Products

    What is the Department Stores in New Zealand Industry?

    Department stores retail clothing, furniture, kitchenware, glassware, houseware, household appliances, soft goods, fabrics, perfumes, cosmetics and toiletries. These products are generally displayed and sold via separate instore departments. Merchandise is sourced from wholesalers and manufacturers and then sold to consumers via bricks-and-mortar stores or online sites operated by industry players. Purely online players are excluded from the industry.

    Industry Products
    Clothing, footwear and personal accessories
    Furniture, housewares and textile goods
    Household appliances and consumer electronics
    Perfumes, cosmetics and toiletries
    Other products
    Industry Activities
    Department store operation
    Clothing, footwear and accessories retailing
    Furniture retailing
    Kitchenware, glassware, houseware and household appliances retailing
    Soft goods and fabric retailing
    Perfumes, cosmetics and toiletries retailing

    Table of Contents

    About this Industry
    Industry Definition
    Main Activities
    Similar Industries
    Additional Resources
    Industry at a Glance
    Industry Statistics Snapshot
    Industry Structure
    Executive Summary
    Industry Performance
    Executive Summary
    Key External Drivers
  • Real household discretionary income
  • Consumer sentiment index
  • Demand from online shopping
  • Demand from clothing, footwear and personal accessory retailing
  • Demand from electrical and electronic goods retailing
  • Demand from furniture, floor coverings, houseware and textile goods retailing

  • Current Performance
  • Trading landscape
  • Competition and profit
  • Industry structure
  • Chart: Revenue Growth

  • Industry Outlook
  • Trading landscape
  • Competition and profit
  • Industry structure
  • Table: Department Stores Industry Revenue Outlook

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

  • Products & Markets
    Supply Chains
    Key Buying Industries
  • Consumers in New Zealand

  • Key Selling Industries
  • Clothing and Footwear Wholesaling in New Zealand
  • Furniture and Floor Covering Wholesaling in New Zealand
  • Household Appliance Wholesaling in New Zealand
  • Pharmaceutical and Toiletry Goods Wholesaling in New Zealand
  • Textile Product Wholesaling in New Zealand

  • Products & Services
  • Clothing, footwear and personal accessories
  • Furniture, housewares and textile goods
  • Other products
  • Household appliances and consumer electronics
  • Perfumes, cosmetics and toiletries
  • Chart: Department Stores Industry Products and Services Segmentation

  • Demand Determinants
    Major Markets
  • People aged 35 to 54
  • People aged 55 and over
  • People aged 15 to 34
  • Chart: Major Market Segmentation for the Department Stores Industry

  • International Trade
    Business Locations
    Chart: Business Locations by State
    Competitive Landscape
    Market Share Concentration
    Key Success Factors
    Cost Structure Benchmarks
  • Chart: Cost Structure Benchmarking – Sector vs Department Stores

  • Basis of Competition
  • Internal
  • External

  • Barriers to Entry
  • Table: Barrier to Entry Checklist for the Department Stores Industry

  • Industry Globalization
    Major Companies
    The Warehouse Group LimitedFarmers' Trading Company LimitedColes Group New Zealand Holdings Limited
  • Table: The Warehouse Group Limited - financial performance
  • Table: Farmers' Trading Company Limited - financial performance
  • Table: Coles Group New Zealand Holdings Limited - financial performance

  • Operating Conditions
    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
    Key Statistics
    Table: Industry Data for the Department Stores Industry
  • Industry Revenue (2009-2023)
  • Industry Gross Product (2009-2023)
  • Establishments (2009-2023)
  • Businesses (2009-2023)
  • Employment (2009-2023)
  • Wages (2009-2023)

  • Table: Annual Percentage Change for Key Industry Data
    Table: Key Ratios for Industry Key Data
    Jargon & Glossary
  • The sale and purchase of goods transacted via the internet.
  • Point Of Sale (Pos)
  • Technology that incorporates a cash register with a credit and debit card electronic payment system in the one device.
  • Radio Frequency Identification (Rfid)
  • This system tracks products through the supply chain by releasing signals from a chip that is inserted in the product at the manufacturing stage.
  • Why buy this report?

    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 in New Zealand:
    • 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 in New Zealand 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 in New Zealand, you can expect thoroughly researched, reliable and current information that will help you to make faster, better business decisions.

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