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MADRID, Nov 7 (Reuters) - Spain's largest retailer El Corte Ingles is revamping its business model to encompass new products and services to beat the financial crisis and the sharp drop in consumption, Expansion said on Saturday, citing unnamed sources. The unlisted department store, present in all large Spanish cities like Madrid, Barcelona and Malaga, has begun to rent out space in its establishments to third parties in exchange for a commission on sales generated by these businesses. These third parties include clothing chains, beauty centres and fast food restaurants, Expansion said. The retailer will also open its first health spa in the Madrid city centre before year-end, which will be operated by a sector specialist, the paper said. El Corte Ingles has traditionally sold a wide range of products from clothes and household goods to gourmet food items. In recent years it has expanded to offer its own insurance and travel agency services. Expansion cited unnamed sources at the retailer as saying that it has not changed its business model and that the contribution from third parties to the group business is marginal. El Cortefiel booked total revenues of 17.3 million euros in 2008. Several chains across Europe have been struggling with the fallout of a global recession as consumers tighten purse strings amid growing concern about rising unemployment and falling house prices. Spain's property sector has been particularly hard hit after a decade-long boom, while unemployment is running at the highest rate in the eurozone. While the Spanish economy hit bottom between the second and third quarters of 2009, analysts still see consumption under pressure due to the labour market. (Reporting by Judy MacInnes; editing by Chris Pizzey) Keywords: SPAIN RETAIL/ (judith.macinnes@thomsonreuters.com; 34 91 585 8340; Reuters Messaging: judith.macinnes.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved.
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