CITIC Securities: Retail Transformation Diving into Deep Water, Prospecting in the Changing Situation

A report from CITIC Securities stated that the current retail transformation has entered a deep-water zone, with many private retail enterprises completing management reforms to promote format transformation in a more thorough manner. The supermarket transformation model similar to the "fat transformation" has achieved results in multiple battles and may serve as a reference template for regional transformation. Traditional department store formats mainly face challenges from nationwide chain commercial shopping centers, with no "standard answer" for transformation yet. The focus is on improving efficiency, reducing losses, and exploring relative advantages. In the medium to long term, companies are expected to expand in areas such as channel extension, brand strength, and self-owned products in the supply chain. Seizing opportunities in the changing landscape: 1. Companies with flexible mechanisms and proactive transformation may have a higher success rate; 2. Focus on the transformation of leading regional supermarkets similar to the "fat transformation", with potentially higher certainty in data realization; 3. Actively monitor the store transformations and offline promotions during the upcoming September and "Golden Week" holiday sales peak.