10.2022 Office Talk
Intensified competition in physical retail, new momentum of integration, development and layout
Group Comprehensive Efficiency and Retail Planning Headquarters / Investment Operation Analysis Group
In addition to the impact of the epidemic on physical retailing, the recently disclosed merger and acquisition news has also cast a shock on the retail industry. The livelihood goods channel will face a situation of double confrontation and high competition. Although the department store shopping center has actively cultivated loyal customers in recent years, and has also attracted new customers through innovative experience and flash mob taste, due to the active expansion of competitors, consumers' time and money have been dispersed, and the competition is also quietly intensifying. This paper will focus on the competitive issues facing the retail industry, and how the retail business of Far Eastern Group will work together to create business opportunities in the future.
The retail sector moved a lot, and the gap between leaders gradually widened
The development of Taiwan's retail industry (including physical channel department stores, mass merchandisers, supermarkets, supermarkets and e-commerce) will have a new layout in 2022. Influenced by the epidemic, the global digital transformation has been accelerated. Enterprises are committed to building online stores and integrating them with offline businesses. E-commerce has risen from the existing foundation, further expanded its application scope, and grown rapidly. It not only divides the food market, but also guides consumption. In the face of pressure, physical stores, in addition to defense, also actively seek opportunities for growth. Whether it is Quanlian's acquisition of RT Mart and Uni President's proposed acquisition of 100% of Carrefour's equity, all these are through mergers and acquisitions to quickly step into different channels to improve growth momentum, and also make the boundaries between mass merchandisers, supermarkets and supermarkets more vivid. However, the situation that Department Store is dominated by Far Eastern Group and Shinko Sanyue is also facing challenges. The Japanese color that Taiwan's leading department stores have been touting for decades has become less attractive to consumers after Japan's Mitsui Group continues to expand its investment.
The trend of "Big Evergrande" is irreversible, and the competitive development in different fields may be different, but expanding market share, vertical or horizontal integration, and continuous innovation to widen the gap are still the same way of operation. A stone from another mountain can make mistakes, observe competition strategies, and self examine the development blueprint, which is conducive to strengthening special projects and making up for deficiencies.
Mass Supermarket Strives for Dominance and Seeks a Niche Market
In recent years, with the change of family type and the development of online channels, the market segmentation has become more and more complicated, and the physical channels have faced high competition. After a new wave of consolidation in the retail industry, the multi-channel layout of supermarket, supermarket and mass merchandiser has taken shape. Through different channel combinations, consumers have more yuan and convenient channels to obtain goods or services.
By acquiring the equity of Carrefour in Taiwan, Uni President Group will have complete access to supermarkets, supermarkets, mass merchandisers and general merchandise, further localizing the retail market in Taiwan. As a manufacturer, Uni President Group will also affect the survival of other businesses and suppliers. The mass market supermarket industry, which emphasizes economies of scale, can effectively reduce operating and logistics costs by expanding its business scale, and strengthen its competitive advantage; And small and medium-sized enterprises must stand firm in the niche market through differentiated positioning and business model. In recent years, A.Mart mass merchandisers of Far Eastern Group have actively expanded online e-commerce and delivery business, trying to break the barriers of stronghold and distance and improve the scope of sales and services; City 'super is positioned as a sophisticated supermarket to create a new life experience with a comfortable shopping environment and a variety of unique commodity types.
Non local retailers enter Taiwan, and the operators actively exhibit their stores
Although the retail market of Taiwan's department stores in the eyes of the department store and shopping center operators is saturated, it is gold everywhere for Mitsui Group of Japan. In the early days, Taiwan's department stores were characterized by Japanese characteristics, and after decades of evolution, they became a unique business model. In order to increase the market share, the industry continues to introduce new brands, but they are still in the Japanese category, and most department stores still retain a strong Japanese color. We are optimistic about the high acceptance of Japanese products by Taiwan consumers. Mitsui Real Estate has moved from "point" to "line" to "surface" and entered the Taiwan market in a planned way. The balance of Taiwan's retail market has gradually loosened in the past 20 years!
Mitsui Real Estate is a comprehensive real estate company. With its business model of real estate in Japan, Mitsui Real Estate invests in Taiwan for the purpose of maximizing regional value, targeting a large number of middle class consumer groups with the characteristics of high consumption, rapid growth, concentrated consumption in urban areas, strong demand for food, clothing, housing, sports and recreation. In 2016, it opened the first OUTLET in New Taipei Linkou, successfully attracting consumers in Taoyuan and Greater Taipei. Later, we actively launched a medium - and long-term investment plan. According to the regional and project characteristics, we planned OUTLET and LALAPORT stores, which spread from Taichung City, Taipei, Tainan and Kaohsiung to the whole Taiwan metropolitan area. Mitsui boldly creates new customers in emerging metropolitan areas, rather than catering to existing customers in elite urban areas, and creates maximum commercial value through rigorous investment plans and low-cost land resources.
There are also active competitors of department stores in Taiwan, such as Nanbatian "Hanshen", a department store, which constantly adjusts and modifies its own store and the egg store to cater to consumer groups, and tries to show the markets north of Kaohsiung. The Taichung City Hanshen Intercontinental Shopping Center is under construction, and may also develop northern stores in the future.
Group retail development and sharing resources to play a comprehensive role
With Taiwan's economic development, the real estate boom and urban expansion have driven population migration. Large scale land suitable for retail development is gradually scarce. With the active exhibition of the same industry, the cost of land investment has risen, and high paying investment projects have disappeared. In the past, the traditional thinking and location selection conditions of exhibition stores should be adjusted according to the location and time. It is not difficult to find out from several investment targets that were not optimistic in the past. Under the rapid changes in the market, different features have emerged in five years and ten years, and even become the elite areas of emerging cities. Investment projects should be evaluated from a more long-term perspective.
The Group's comprehensive efficiency and retail planning headquarters, taking into account different theoretical models, such as the proportion of department stores' turnover in the amount of population consumption, per capita area of department stores, etc., estimated the supply and demand of department stores in each county or region five years later, and concluded that there is still room for department stores development in Shuangbei Southwest District, Taoyuan, Tainan, Hsinchu and other places. As for Shuangbei East District, Taichung City, Kaohsiung and other places, although they will be relatively saturated in the future, There are still opportunities to seize the market with innovative business models.
In order to enable the investment and development of the retail business of Far Eastern Group to take into account the interests and efficiency of the Group, the Group's comprehensive efficiency and retail planning headquarters have joined hands with enterprises to launch retail development teams in all regions, invite retail companies that have stores or are interested in layout in the region to participate, gradually screen out high-quality development projects through development information sharing and interactive discussion, and use the most appropriate development model, Consolidate the business foundation of FE Retail Group in the coming decades!
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The retail sector moved a lot, and the gap between leaders gradually widened
The development of Taiwan's retail industry (including physical channel department stores, mass merchandisers, supermarkets, supermarkets and e-commerce) will have a new layout in 2022. Influenced by the epidemic, the global digital transformation has been accelerated. Enterprises are committed to building online stores and integrating them with offline businesses. E-commerce has risen from the existing foundation, further expanded its application scope, and grown rapidly. It not only divides the food market, but also guides consumption. In the face of pressure, physical stores, in addition to defense, also actively seek opportunities for growth. Whether it is Quanlian's acquisition of RT Mart and Uni President's proposed acquisition of 100% of Carrefour's equity, all these are through mergers and acquisitions to quickly step into different channels to improve growth momentum, and also make the boundaries between mass merchandisers, supermarkets and supermarkets more vivid. However, the situation that Department Store is dominated by Far Eastern Group and Shinko Sanyue is also facing challenges. The Japanese color that Taiwan's leading department stores have been touting for decades has become less attractive to consumers after Japan's Mitsui Group continues to expand its investment.
The trend of "Big Evergrande" is irreversible, and the competitive development in different fields may be different, but expanding market share, vertical or horizontal integration, and continuous innovation to widen the gap are still the same way of operation. A stone from another mountain can make mistakes, observe competition strategies, and self examine the development blueprint, which is conducive to strengthening special projects and making up for deficiencies.
Mass Supermarket Strives for Dominance and Seeks a Niche Market
In recent years, with the change of family type and the development of online channels, the market segmentation has become more and more complicated, and the physical channels have faced high competition. After a new wave of consolidation in the retail industry, the multi-channel layout of supermarket, supermarket and mass merchandiser has taken shape. Through different channel combinations, consumers have more yuan and convenient channels to obtain goods or services.
By acquiring the equity of Carrefour in Taiwan, Uni President Group will have complete access to supermarkets, supermarkets, mass merchandisers and general merchandise, further localizing the retail market in Taiwan. As a manufacturer, Uni President Group will also affect the survival of other businesses and suppliers. The mass market supermarket industry, which emphasizes economies of scale, can effectively reduce operating and logistics costs by expanding its business scale, and strengthen its competitive advantage; And small and medium-sized enterprises must stand firm in the niche market through differentiated positioning and business model. In recent years, A.Mart mass merchandisers of Far Eastern Group have actively expanded online e-commerce and delivery business, trying to break the barriers of stronghold and distance and improve the scope of sales and services; City 'super is positioned as a sophisticated supermarket to create a new life experience with a comfortable shopping environment and a variety of unique commodity types.
Non local retailers enter Taiwan, and the operators actively exhibit their stores
Although the retail market of Taiwan's department stores in the eyes of the department store and shopping center operators is saturated, it is gold everywhere for Mitsui Group of Japan. In the early days, Taiwan's department stores were characterized by Japanese characteristics, and after decades of evolution, they became a unique business model. In order to increase the market share, the industry continues to introduce new brands, but they are still in the Japanese category, and most department stores still retain a strong Japanese color. We are optimistic about the high acceptance of Japanese products by Taiwan consumers. Mitsui Real Estate has moved from "point" to "line" to "surface" and entered the Taiwan market in a planned way. The balance of Taiwan's retail market has gradually loosened in the past 20 years!
Mitsui Real Estate is a comprehensive real estate company. With its business model of real estate in Japan, Mitsui Real Estate invests in Taiwan for the purpose of maximizing regional value, targeting a large number of middle class consumer groups with the characteristics of high consumption, rapid growth, concentrated consumption in urban areas, strong demand for food, clothing, housing, sports and recreation. In 2016, it opened the first OUTLET in New Taipei Linkou, successfully attracting consumers in Taoyuan and Greater Taipei. Later, we actively launched a medium - and long-term investment plan. According to the regional and project characteristics, we planned OUTLET and LALAPORT stores, which spread from Taichung City, Taipei, Tainan and Kaohsiung to the whole Taiwan metropolitan area. Mitsui boldly creates new customers in emerging metropolitan areas, rather than catering to existing customers in elite urban areas, and creates maximum commercial value through rigorous investment plans and low-cost land resources.
There are also active competitors of department stores in Taiwan, such as Nanbatian "Hanshen", a department store, which constantly adjusts and modifies its own store and the egg store to cater to consumer groups, and tries to show the markets north of Kaohsiung. The Taichung City Hanshen Intercontinental Shopping Center is under construction, and may also develop northern stores in the future.
Group retail development and sharing resources to play a comprehensive role
With Taiwan's economic development, the real estate boom and urban expansion have driven population migration. Large scale land suitable for retail development is gradually scarce. With the active exhibition of the same industry, the cost of land investment has risen, and high paying investment projects have disappeared. In the past, the traditional thinking and location selection conditions of exhibition stores should be adjusted according to the location and time. It is not difficult to find out from several investment targets that were not optimistic in the past. Under the rapid changes in the market, different features have emerged in five years and ten years, and even become the elite areas of emerging cities. Investment projects should be evaluated from a more long-term perspective.
The Group's comprehensive efficiency and retail planning headquarters, taking into account different theoretical models, such as the proportion of department stores' turnover in the amount of population consumption, per capita area of department stores, etc., estimated the supply and demand of department stores in each county or region five years later, and concluded that there is still room for department stores development in Shuangbei Southwest District, Taoyuan, Tainan, Hsinchu and other places. As for Shuangbei East District, Taichung City, Kaohsiung and other places, although they will be relatively saturated in the future, There are still opportunities to seize the market with innovative business models.
In order to enable the investment and development of the retail business of Far Eastern Group to take into account the interests and efficiency of the Group, the Group's comprehensive efficiency and retail planning headquarters have joined hands with enterprises to launch retail development teams in all regions, invite retail companies that have stores or are interested in layout in the region to participate, gradually screen out high-quality development projects through development information sharing and interactive discussion, and use the most appropriate development model, Consolidate the business foundation of FE Retail Group in the coming decades!
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