Appliances, the crazy illusion that cost 1.000 megastores

In 2000 points of sale of consumer electronics and household appliances were approx 1.800. Then they started running, and the retailers competed to see who opened the most, all of them blockbuster and pyramidal. Among jokes, jokes and party favors. Sales, profits and square meters rose also because the digital revolution of flat TVs and smartphones had just begun. In 2008, total stores were close to the mark 3mila (there were about 2.800). But reality soon became worrying: troo many shops, many useless, many at a loss, while the openings continued because each new shop increased the perimeter of sales with a totally wrong optical-monetary illusion. After replacing the old CRT TVs with the new flat TVs, the boom deflated and the wild promotions, self-defeating, the balance sheets of many retailers have demonstrated the risks of expansion at all costs. I meanwhile average prices fell and with them the margins. Even the points of sale and in 2010 the total was already under 2.500, in 2013 around 2.200 and today we are below 2, more exactly at 1.870. A drain on employees but also a disastrous collapse due to financial inexperience, lack of long-term strategies and many other "whys" which in the general climate of growth have had no official answer. And in the background a gigantic question that remained the same: does anyone know anything about the giant waves of money who have sought and found ample space in the expansion of distribution?

Why so many mega showrooms in the South?

A step back towards the roaring years of the openings allows us to deepen the accumulation of continuous jet openings that characterized retail in the southern regions, i.e. the poorest ones. Even now, very few of those who should have investigated and analyzed these distribution bubbles in the South have done so. Let's try to do it now, in the midst of distrust, closed mouths ("it's better to let it go"). For example in the decades of expansion strange maneuvers in the poorest region (together with Basilicata and Sardinia), namely Sicily, have led to enormous numbers of points of sale, what's more not justified by the reservoir of customers with decidedly poor, even miserable incomes. And here gigantic concentrations of points of sale of all chains and groups (up to 15 thousand square meters, in Misterbianco in the Catania area for example, and not the only one). Not only that: a 15 km distance had been opened gigantic mall with just as many fearless retailers only a few tens of meters away from each other and while dealing with the exact same products. They have resisted for a long time, even if half empty, even in the conspicuous decline of margins and customers.

From Misterbianco to Afragola

And, incredible, while the crisis began to "bite" in 2008 causing the number of shops to close in the other regions, in Sicily even the shops in the sector rose from 221 in 2008 to 277 of 2009. Another of the many examples of gigantic concentrations was Afragola, an area that in Campania holds records for Camorra&Co presences, where all, absolutely all the brands of the GD (large distribution), of the GDO (big organised distribution)of the GDS (Global distribution system) and mini independent chains had opened spaces in a gigantic one fusion between food, technology, housewares, jewellery, do-it-yourself and so on. No pool of customers could ever have sustained the economic survival of these huge concentrations for a long time, but what was astonishing and astonishing is that there had been tanti-capital to start many initiatives and even for a long time. And only in Calabria did the expansion of retail correspond to the worthy attention of those who had to investigate; to rizziconi for example, where the mega Il Porto degli Ulivi shopping center (over 37 mXNUMX) was built with the funds of entrepreneurs closely linked to the 'drangheta and as such tried and convicted.

Promotions and factory closures

When, in the last three years, the growth of thee-commerce, the one with bargain prices, the absence of services and quality, also important historical brands of northern and central Italy have been overwhelmed. That's why Aires, the association that brings together consumer electronics and household appliances retail chains and groups, has created Optime, a permanent observatory for the protection of the electronics market for monitoring the correctness of online commercial operators. Often some of these operate heavily evading the heavy tax obligations of the sector. But blaming online sales, as most retailers do, doesn't explain the extent of the crisis; serves to misrecognize serious strategic and tactical errors put in place for years such as the competition to practice the suicidal price-cutting policy, borne by manufacturers, which has gradually involved segments which, such as high-end products, built-in appliances and large household appliances, needed to be preserved. And which has contributed to the relocation of dozens of European factories with the loss of tens of thousands of jobs. In 2011, there were around 150 employees in the Italian household appliance industry (source Anie) and in 2017 they had dropped to 35 (source Ceced Italia). And today it happens that Amazon's prices are often higher than those of many flyers and in some cases even to the average ones in the shop. Historical names of qualified distribution such as Derta dei Sonato (the legendary Albino, president of Euronics for a long time), Galimberti, Castoldi, have either disappeared or entered a gripping crisis. The 40 outlets of the Piccinno company, with the Trony brand, which is part of the GRE group, are in crisis; In 2013 Piccinno had taken over management of Fnac Italia, an indigestible morsel of as many as 30 points of sale, in difficulty Mediaworld Italia which, between closures and transfers of employees, is trying to return to the flourishing balance sheets of the golden years.