Department store chain
A year after the bankruptcy: is Galeria back on course?
The restart at Galeria has not yet been completed. Twelve months after the end of the bankruptcy proceedings, the company comments on its own situation – and possible further branch closures.
It was a year ago that a big, traditional name in German trade dared to start the fresh start. At the end of July 2024, the bankruptcy proceedings of the Galeria department store ended. Shortly afterwards, new owners took the lead. Is Galeria back in the road to success?
The company is satisfied with the current development. “Galeria has 83 branches that run profitably. It is a great success,” says a spokeswoman. When asked whether a financial trouble is threatening again in the foreseeable future, she replies: “Galeria is on a stable balance sheet foundation, against this background we continue to see the future.” Further branch closings are currently not planned.
In early 2024, Galeria had to register bankruptcy for the third time within four years. Nine department stores were closed in the course of the procedure. The chain of the US investment company NRDC and a participation company of the entrepreneur Bernd Beetz has been owned for twelve months.
“We perform better than many competitors”
In January, Beetz announced in the “Handelsblatt” to increase sales in the current financial year to just under 2.5 billion euros. In the meantime it is said that this number is “a medium -term vision” that is to be reached in two to five years. The results would be “above expectations” and should still increase significantly. Galeria does not give any specific figures on request.
Retailers still suffer from the fact that many customers are noticeable when shopping. The German trade association expects inpatient trade in 2025 to be more adjusted for inflation than last year.
“We perform better than many competitors,” says the Galeria spokeswoman. In view of the consumption, this is remarkable. Galeria does not comment on a “Handelsblatt” report, according to which sales and profit had dropped significantly compared to the previous year.
Cooperation should attract young customers
In the spring, the restart of the department store chain suffered a setback: CEO Olivier van den Bosche, who was supposed to make it significantly. At the time, his leadership was “decisive for the positive development of the company” during the bankruptcy and restructuring. One reason for the separation was not mentioned. Now Tilo Hellenbock and Christian Sailer are in charge.
However, the restart is far from being completed. The move of the company headquarters from Essen to Düsseldorf should only be completed in the course of the year. Most recently, Galeria had announced that the sporting goods dealer Decathlon and the food discounter Lidl would move into some branches. Further collaborations should follow. From brands such as Snocks and Copenhagen Studios, they promise to attract more young customers.
The past of the chain is still visible in many places. Whether in Würzburg, Cologne or Potsdam: At a number of branches, the old Karstadt or Kaufhof signs continue to hang on the facades- although the brands were deleted from the company name a year ago.
Expert: “The air is still thin”
Galeria reports progress in modernizing its department stores. 20 of them have been rebuilt since last summer, four more are to follow in 2025. In the future, five to ten locations are to be modernized annually. Galeria does not reveal how much and in which houses.
That is not enough for Carsten Kortum, trading expert at the Baden-Württemberg University of Applied Sciences in Heilbronn. “The investment backlog would only be dissolved after ten years, then the first converted shops from 2024 would almost be back,” he says. In many houses, attractive conditions for customers and employees were missing. The trading expert estimates the investment requirement at 20 million euros per branch. “The air is still thin and investors try to pull money out of the company as in the past.”
A study by the Nuremberg Institute for Market decisions published in February gives some hope: Around 2,000 people between the ages of 16 and 69 took part in the representative survey. For 81 percent of them, department stores belong to a city center, almost every second one considers them indispensable. Accordingly, younger people even buy there. According to the study authors, the potential harbors – provided that people remain loyal to the department stores.
dpa
Source: Stern
