Retail News :Karstadt is struggling in a promotional environment

According to Frankfurter Allgemeine Zeitung, the leading German daily newspaper, Andrew Jennings, chief executive of Karstadt, has informed the company’s staff about a generally challenging retail situation, which has recently led its competitors to cut prices sharply.

Another report in Textilwirtschaft, the German trade magazine for apparel retailers, says that the big German chain of department stores and sporting goods stores has invited its suppliers to share of the burden for price cuts of 50 percent – a strategy that Karstadt has applied then and again, often with little success.

According to FAZ, Karstadt booked a net loss of €21 million in the financial year ended in September 2011. The accounts for the year have not yet been published, but the deep red figure was reportedly due to non-recurrent charges of €33.5 million stemming from Karstadt’s bankruptcy in 2009. Apparently, the operating income improved, reaching a positive result of €16.3 million.


by SGI Europe through Ispo Newsblog