It may have taken a couple of years, but there are some early signs the retail market is finally beginning to recover.
Both Country Road and Fantastic Holdings have managed to deliver good news for sales and profits, with both companies triggering commentary that the retail market is on an early upswing before Christmas.
The message is clear, experts say: things are getting better.
“They definitely are improving,” says City Markets analyst Peter Esho. “Although they’re coming off a low base.”
But with the market on the cusp of a recovery, Esho says it’s not enough for businesses to just wait for the customers to come to them – they need to start innovating.
“They need to start doing different things and adjusting to the times, with new products and offerings.”
“They have to actively go after the customer.”
Australian Retailers Association executive director Russell Zimmerman told SmartCompany this morning he believes spending is beginning to increase.
“You’ve seen the rate cuts start to flow through, and in the cases of some retailers…they’ve tightened up their business practices.”
The news is a welcome reprieve after word of Retail Adventure’s collapse broke last weekend. And it’s even better when Country Road’s positive performance is contrasted with the lacklustre past few years in the fashion retail industry.
The company reported comparable sales were up 13.5% for the October quarter and sales in its South African stores were up 8.5%.
Fantastic Holdings reported an 8% increase in net profit last month, but said in a trading update yesterday that the first quarter has already seen positive sales growth for the group.
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