Department Stores

Urbis is an Australian-based property consultancy, with a particular interest in the retail sector. Its markets are principally in the Middle East, SE Asia and Australia. Michael Baker, a consultant at Urbis, writes a bi-monthly newsletter called Retail Perspectives. He also writes occasional articles for the Sydney Morning Herald.

A few weeks ago, Baker wrote an article on the Spanish retail market, using Barcelona as his reference point. He makes good work of describing the Inditex phenomenon [this is the group that owns Zara, and several other fashion formats]. But it's his contrast with the fortunes of El Corte Ingles which makes entertaining reading.

He describes El Corte Inglés' flagship store on the east of side of the Placa de Catalunya as: "a hulking, white and almost windowless" department store, which "resembles a huge motionless iceberg, as though waiting to be towed to a warmer place so it can melt".

Baker goes on to say that "inside El Corte Inglés the scene is reminiscent of department stores the world over - a once dominant retail format that is now just going through the motions. Its customer base is ageing, along with its fit-out. Customers rummage quietly among discounted items. There are no queues at the register".

Over the years, many commentators have forecast the demise of the department store, but it's still a format that can surprise. Take one modest example - John Lewis, a department store chain that is often described as the bellwether of middle class spending in the UK. In recent years, John Lewis has significantly increased its capabilities in consumer electronics. For example, its latest weekly sales figures [they publish these numbers every week] show that its electricals and home technology buying directorate is currently being boosted by strong sales of televisions, set-top boxes, satnavs, camcorders and cameras. There won't be many stores, of any colour, saying that right now...