Department Stores Industry Overview

Excerpt from Department Stores Report

The US department store industry includes about 20 companies that operate about 3,500 stores with a combined annual revenue of about $60 billion. Major companies include Sears, JCPenney, Macy's (which owns Bloomingdale's), and Dillard's. The industry is highly concentrated: the top eight companies generate about 95 percent of industry revenue.

Competitive Landscape

Consumer spending and fashion trends drive demand. The profitability of individual companies depends on effective merchandising and marketing. Large companies have advantages in purchasing, distribution, and marketing. Small companies can compete effectively by offering unique merchandise, providing superior customer service, or delivering a distinctive store experience. The industry is labor-intensive: average annual revenue per worker is about $110,000.

Products, Operations & Technology

Major products sold include apparel (about 55 percent of sales) and cosmetics, footwear and appliances (8 percent, 7 percent, and 7 percent of sales, respectively). Apparel includes women's, men's, and children's clothing. Cosmetics include makeup, skin care, hair care, and fragrances. Appliances include refrigerators, stoves, washers, dryers, and dishwashers. Companies may also sell kitchenware, bedding, towels, and sheets. Services include gift wrapping, delivery, appliance installation, and personal shopping.