Department stores remains a channel in decline in the Czech Republic. Mandatory store closures and other restrictions during the first half of 2021 continued to put pressure on sales, while department stores also continued to suffer from the shift towards e-commerce.
One of the major issues for department stores is the deteriorating infrastructure and outdated look of the buildings they are housed in. Modernisation costs are very high, which is one of the reasons Tesco decided to retreat from this type of real estate.
Domestic department store operator Prior Ceska Republika remains the only department store chain still operating in the Czech Republic with 15 outlets, none of which are located in Prague. While the company has modernised a few of its stores, it is unlikely that this will bring substantial sales growth or customer traffic.
The exit of Tesco and Debenhams from the department stores channel during the review period was reflective of the global decline in the popularity of department stores. Based on current projections there is little hope of any significant turnaround in fortunes for the channel with consumers increasingly showing a preference for other retailing channels.
The Prior chain may try to renovate some of its outlets to offer a more modern shopping experience and seek to attract customers through discounts and special price offers. However, the company is expected to start selling off its least profitable outlets.
Any temporary boost to value sales generated by the lifting of COVID-19 restrictions will likely be dampened by the increasingly negative perception of department stores among Czech consumers. The decline in the popularity of the channel will also deter popular brands from making an entrance.
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Understand the latest market trends and future growth opportunities for the Department Stores industry in Czech Republic with research from Euromonitor International's team of in-country analysts – experts by industry and geographic specialisation.
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Department stores are chained or independent retail outlets that usually exceed 2,500 sq metres of selling space, are typically in high-street or shopping mall locations, and have a primary focus on selling a range of non-food/drink/tobacco merchandise across several categories in different departments. Department stores usually have a mid-to-upper price positioning. Example brands include Macy’s, Marks & Spencer, and Takashimaya.
See All of Our DefinitionsThis report originates from Passport, our Department Stores research and analysis database.
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