According to data from the International Association of Department Stores (IADS), which analyzed the financial performance of 59 department store chains worldwide, sales dipped by 1.6% in 2023/24 compared to 2022. The outlook for 2025 remains uncertain.

After a strong rebound following the pandemic in 2020, the global department store sector is showing signs of slowing down. The latest Economic Observatory report from the International Association of Department Stores (IADS) reveals a 1.6% decline in global department store sales for the 2023/24 fiscal year compared to the previous year.

The report is based on publicly available financial data from 59 department store groups worldwide, including El Palacio de Hierro in Mexico, Macy’s in the United States, Dashang in China, Isetan in Japan, Magasin du Nord in Denmark, and El Corte Inglés in Spain.

“In 2024, the global economy—including the retail industry—has faced significant market uncertainty, sluggish economic growth, and unfavorable interest rates across all regions. The post-COVID-19 peak seen in 2021 and 2022 is now behind us, and overall retail growth has stabilized. Department stores have followed this trend, albeit with regional variations,” the federation explained.

In the Americas, sales have remained flat, but a clear divergence has emerged: department stores owned by large groups have seen revenues decline. At the same time, independent retailers have reported slight year-over-year sales growth, according to the report.

In the Asia-Pacific region, department store revenues declined due to a regional slowdown, particularly in Japan, South Korea, and Hong Kong. However, India and the Philippines bucked the trend, posting positive sales growth.

Europe followed a similar pattern, with both corporate-owned and independent department stores reporting an average growth of less than 1%.

Despite the challenges, the share of revenue generated by department stores within their parent companies’ total sales has stabilized globally, returning close to pre-pandemic levels. This is mainly due to a drop in total sales across parent companies after the 2021–2022 peak, driven by weakened purchasing power and a slowdown in the luxury sector.

Looking ahead, 2025 presents new uncertainties for department stores, particularly due to shifts in U.S. trade policy.

“The election of Donald Trump as president of the United States and the imminence of new tariffs will likely reshape global retail supply chains. While inflation has eased in some economies, the U.S. market remains concerned about stagflation despite Trump’s pro-growth agenda. The global impact will be significant, with the European Union, China, and Canada, among other countries, already discussing potential trade retaliation,” the federation noted. It warned that the 2025 outlook for department stores could see a sharper decline than in 2024.

Amid these concerns, IADS highlighted the rising impact of emerging Asian markets, particularly Vietnam and India, in the global retail landscape. Department store expansion remains strong, with Galeries Lafayette planning to open in Mumbai this year and in Delhi by 2026.

In Europe, sustainability regulations are set to reshape the retail industry. “Revised sustainability directives require retailers to conduct comprehensive environmental reporting and compliance reviews by 2028,” the report stated. These regulations add to the sector’s existing challenges, including omnichannel transformation, experiential retail initiatives, and adapting to shifting consumer preferences.

*IADS represents a network of department stores worldwide, including Beijing Hualian Group (China), Bloomingdale’s (U.S.), Boyner (Turkey), Breuninger (Germany), Centro Beco (Venezuela), Chalhoub (UAE), El Corte Inglés (Spain), El Palacio de Hierro (Mexico), Falabella (Chile, Colombia, Peru), Galeries Lafayette (France), Lifestyle International Holding (Hong Kong), Magasin du Nord (Denmark), Manor (Switzerland), The Mall Group (Thailand), and TSUM Kyiv (Ukraine).