Takashimaya to close its Shanghai store in August, bowing to the onslaught by e-commerce in China’s retail revolution
- Takashimaya will close its store near Shanghai’s Hongqiao airport, which currently occupies 60,000 square metres in seven stories, on August 25
- The closure of Shanghai Takashimaya, which has been unprofitable for the past three years, is likely to incur a loss estimated at US$27.9 million
Takashimaya Company, the upscale Japanese department store, will close its sole China outlet in August, following the trend among international retailers to succumb to the onslaught of e-commerce and online shopping in the world’s most populous nation.
“Rapid changes in the consumption structure and fierce industry competition have exceeded our expectations,” said the Osaka-based retailer. “The future store operation would be very hard. Due to these circumstances, we have decided to close the business.”
The closure, after a mere seven years of operating in the world’s largest consumer market, is a bookend for the centuries-old retailer that traces its roots to a family-run clothing store in Kyoto in 1831. The spending power of China’s growing middle class has seen an explosive growth over the last five years, magnified by electronic payments, smartphone-enabled online shopping and last-mile deliveries.
Together, they have transformed the way consumers shop, order food or pay for entertainment, helping technologically enhanced retailers such as JD.com and Alibaba Group Holding – the owner of South China Morning Post – drive traditional retailers who rely on foot traffic out of business.