Zara, Primark and Conrad: More and more shops are moving out of the inner cities

Created: 03/05/2022, 14:42

By: Fee Halberstadt

Some shops are closing in the inner cities of Germany.

(Iconic image) © Ralph Peters/Imago (Iconic image)

More and more retailers such as Zara, Primark and Conrad are closing their branches in the inner cities.

However, the reasons are very different.

Kassel - "The pandemic has put many trading companies in an economic emergency," reports Stefan Genth.

He is the general manager of the German trade association HDE.

The result: shops in shopping streets are empty.

Some retailers that offer non-food products and clothes have to close branches, Genth explained in an interview with the technology magazine Chip.

Retailers are closing branches: Zara and Galeria Karstadt Kaufhof are withdrawing from the inner cities

The retailers affected also include large chains such as Primark, Zara, Conrad and Galeria Karstadt Kaufhof.

The Galeria group has already shrunk by a total of 60 branches in recent years.

Now two more branches are to close at the beginning of 2023, this time in Halle an der Saale.

According to Chip, several Zara branches have already closed in recent months.

Gerrit Heinemann, economist and professor specializing in e-commerce, online retail, multi-channel retail and the future of retail, sees clear growth in contrast to the withdrawal from German inner cities: "Online retail is coming according to my calculations already at 26.7 percent for non-food, and even more than 50 percent for clothing.” In the long term, he assumes “a 50 percent online share in all non-food product groups.”

Online instead of inner cities: dealer Conrad Electronic closes all branches

Part of the reason for this change is certainly due to the consequences of the corona pandemic.

“Months of lockdown and subsequent 2G and 3G restrictions have seen footfall and sales plummet,” said Genth.

In addition, there is now a kind of "channel doesn't matter" mentality among many customers: Many people find an item on the Internet before they think about where to buy it.

The technology provider Conrad felt exactly this mentality.

In a press release, the retailer announced: "As a result, Conrad will no longer operate its branches in the previous format and number." Instead, Conrad is switching to full online trading for private customers.

"All other branch locations are or will be closed in the course of the year." Specifically for consumers, this means that there will soon only be a single branch in Wernberg-Köblitz.

Corona pandemic as the reason: numerous retailers are closing branches in city centers

Since the company noticed that private customers mostly shop online, they use this opportunity.

Instead of private customers, the company now has more customers in the corporate sector: so-called B2B, i.e. business-to-business relationships.

Conrad made this strategy change years ago, and it seems to be working.

"At the location in Hürth in North Rhine-Westphalia, the company put its first B2B branch into operation in early summer 2020 and is looking for other locations," says the press release.

This means that the products will no longer be sold in Conrad's own branches, but by external wholesalers.

The popular fashion chain Primark is dealing with the situation differently.

Although the retailer had to close branches in Germany for the first time due to a drop in sales during the corona pandemic, Primark does not want to create an online offer.

"If there was an e-commerce opportunity for us, it would probably be more in the click-and-collect space," finance director John Bason told Reuters.

So Primark will obviously try to maintain the stationary branches.

(Fee Halberstadt)