Dept. stores hold off on spring sales to boost profitMajor department stores are delaying their spring sales by five days this year in a desperate bid to boost profits by maintaining products’ original prices for longer.
Shinsegae, Hyundai and Lotte all said they will begin their respective seasonal sales on April 6 - the latest start date recorded in the last decade - and run them for 17 days.
The stores are hoping to make up for sluggish sales as their revenues have been declining since the turn of the year, according to official reports.
The Ministry of Knowledge Economy said they recorded a negative sales growth of 4.2 percent on average in January.
This was followed by single-digit growth last month, according to an industry official.
Hyundai Department Store said sales of men’s clothing grew 4.5 percent on-year last month while women’s clothing grew 3.9 percent.
Consumers showed the impact of rising inflation with their reluctance to spend in the first two months of the year, and are hesitant to splash out on spring clothing due to the unusually cold weather, said an industry insider.
Spring clothing is a major source of revenue for department stores as it accounts for 75 percent of their total products at this time of year, the source said.
The stores’ sales will now end on April 22, thus shortening the time between wrap-up and the three red-letter days in late April and early May - namely, Children’s Day, Parents’ Day and Teachers’ Day.
The department stores said they will also be able to link their spring sales promotions more closely to these days due to the delay.
They hope this will encourage consumers to spend more.
During the past decade, the three stores have usually started their spring promotions on March 30 or April 1.
“Last year, we got things going on March 30, but we decided to push the date back this year due to the poor sales figures,” said an official at Lotte.
“If we start the event in late March, higher sales on the first day of the event will be calculated as part of the revenues earned that month, which is not good for us,” she said.
By Song Su-hyun [email@example.com]
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