Unseasonably hot weather has got retailers around Australia in a sweat, as they begin to slash prices on autumn and winter clothing ahead of schedule.
Mid-season sales, which generally commence in July, are being brought forward by retailers around the country to combat poor sales.
Executive director of the Australian Retailers Association, Russell Zimmerman, says that the signs are “a major worry”.
“Retailers are getting their stock in for the winter and haven’t been able to sell the previous season’s stock at a fast enough rate,” Zimmerman tells SmartCompany.
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“The problem is having a backlog of stock. If retailers brought in $100,000 worth of stock in February and only sold $10,000 worth there is a major amount of physical stock in the stores.
“There now comes a need for stores to find space for these products and it gets to a stage where slashing prices to get customers through the door to purchase the items at a discount rate. The only winner here is the consumer,” he says.
Australian department stores have already started advertising mid-season sale opportunities, including cooler-weather gear.
Women’s fashion retailers, including Sussan and Seed have sales ranging between 20-50% on items on their online stores.
Zimmerman believes that this could raise an even more pressing issue for small businesses.
“The bigger retailers are often able to advertise these sales more effectively, in some cases they can afford television advertisements or take a large paper advertisement,” Zimmerman said.
“In most cases, [small businesses] can’t get these messages out to their buyers as effectively and have to rely heavily on Facebook to get consumers in the door,” Zimmerman says.
“Often, but not always, big businesses have larger funds [than small businesses]. Small businesses aren’t always as well funded and sometimes they may have to reach into their own bank accounts.”
Zimmerman believes that these sales aren’t necessarily a last resort, but the alternatives to slashing prices would be quite disruptive.
“Retailers need to continue getting stock in, just like their suppliers need to be paid and their overseas counterparts and so on,” he says.
“The bigger worry is the effect, that these scenarios can have on employment. It can get harder and retailers can’t afford to employ staff in the same ways that they used to, especially casual staff, they may have to turn around and say ‘I can’t afford to give you the usual hours’.”