Department store retail group Parkson has announced that it plans to close two outlets in Beijing and Changsha, citing retail area and lack of sales.
Both of the stores are said have business areas of less than 10,000 square meters.
Parkson said the total sales of these two stores were about CNY48.9 million in 2008, accounting for 0.5% of the total sales of the group while their profits were about CNY11.1 million, accounting for 0.3% of the total profits of the group. As a result closing the two stores will not have much effect on the group.
According to the retailer, the closure of stores with business areas of less than 10,000 square meters aims to allow the group to concentrate its resources on larger department stores. It is expected that the company will soon open a new outlet in Beijing with a total retail area of 60,000 square meters.
Parkson's annual report for 2008 showed that the group plans to add at least 120,000 square meters to its total retail area in 2009. In addition, it plans to increase its retail area at an annual growth rate of about 15% to 20% both by opening new outlets and by acquisitions.