Evolution of fashion sector in Poland6 March 2019
Poland has almost 500 shopping centers which offer space for approx. 250 companies representing 350 key brands. In more than 130 shopping centers studied by RI, fashion represents as much as 50% of the offer. For this reason, changes in the fashion sector will, to a large degree, determine future shape of shopping centers.
Fashion is a constant race against time. Each season brings novelties, but new clothing or footwear collections are often not enough. Innovative products and services must go beyond the designer’s desk and apply to the entire company – from transport, through logistics, to sale process. As implementation of changes is time-consuming and costly, key companies tend to use innovations and new technologies which give an extra cutting-edge for development more and more often. How do changes in fashion companies affect shopping centers? What challenges come with fashion brands for shopping centers in Poland?
Popular fashion retail chains tend to close stores with lower performance or plan such steps for the months or years to come. Shopping center premises which do not generate expected turnover and are unlikely to improve in the future or those where the costs (rent + costs) to turnover ratio is lower than elsewhere are or will be closed. RI experts worry that gaps in the tenant mix will be difficult to patch with new brands, which appear at a slower rate compared with brands that disappear from shopping centers for good. Retail chains will try to compensate their reduced performance with on-line sale, which in case of many companies stimulates deep structural changes. This is however a complex and costly process, which requires involvement of all company units and, therefore, its results are to be expected only after a few years. Such a period of time is an opportunity for shopping centers and the last call to become modern and innovative retail spaces which meet aspirations of both customers and tenants. Those shopping centers which implement smart management and apart from standard space renting will offer tenants a vast range of services will be in the forefront. Ironically, services are the future of retail. What does it mean? What type of services should be developed? Which ones may boost development of retail chains and transform shopping centers into a vital part of development strategies for fashion companies? What are the expectations of tenants?
This is the time when we have more questions than answers. We should use it to bring market leaders together, look for solutions and implement changes.
“From a different perspective” is a cycle of meetings organized by Retail Institute which present a fresh view on the retail sector – through the lens of ambitious retail and service chains which aspire to become trendsetters determining today the future role and function of shopping centers.