Shoppers around the country have become accustomed to the big mid-year stocktake sales of the major department stores, but this year Myer customers will have to wait an extra two weeks to grab a bargain.
The retailer traditionally launches its stocktake sale in the first week of June, but shoppers will have to wait until June 18 this year.
A spokesperson for Myer told SmartCompany this morning the retailer has decided to hold its stocktake sale at a later date based on feedback from its customers.
But Fairfax reports the delay is a response to weak consumer confidence and unusually warm weather for May and June, which is leaving winter clothes hanging on their racks.
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The Myer spokesperson says the retailer has also “planned a new approach to stocktake” this year with a one-day ‘stocktacular’ sale to be held on Wednesday June 4, as well as several other “countdown offers to build excitement in the lead up to the stocktake sale on Wednesday 18 June”.
The move has been interpreted by some as yet another indication of weak consumer confidence, with the latest ANZ-Roy Morgan Consumer Confidence report showing confidence fell 15% over the past five weeks to its lowest level since the Global Financial Crisis in May 2009.
Retailers including toy distributor Funtastic and shoe company RCG Corporation, owners of The Athlete’s Foot, have this week downgraded their earnings expectations, with RCG specifically referencing the effect the federal budget has had on consumer spending.
But Russell Zimmerman, executive director of the Australian Retailers Association, told SmartCompany this morning the delay in Myer’s mid-year sale is “not a worrying sign”.
Instead, Zimmerman says it’s a “smart move” on behalf of the retailer, which is likely responding to the unusually warm start to the winter season.
“If you are selling winter boots and coats and heaters and electric blankets, any seasonal products, general sales have probably not been what you would have liked to have seen at this point,” says Zimmerman.
“So putting on a sale now, with the cold weather just starting, might solve the immediate problem, but you would likely lose margins on those products,” he says. “If you can hold out, you will most likely get those sales anyway.”
Zimmerman commended Myer’s recent promotional activities, including holding regular one-day offers on Saturdays, and said using one-off discounts in the lead up to the main stocktake sale is a “very smart move”, as it will allow the stores to discount and sell individual product lines or ranges.
Speaking about consumer confidence, Zimmerman says he is seeing mixed results across the market.
“It’s extremely patchy,” says Zimmerman. “Some retailers I’ve spoken to are 30-40% down, while others are trading and a few are up a little bit.”
While Zimmerman said it is difficult to draw definite conclusions about how confident consumers are at the moment, he says he thinks he is seeing some companies struggling “at the discount end of the market”.
Zimmerman said the federal budget is weighing on some people’s minds, especially measures that will increase the cost of petrol and visiting the doctor, but he believes consumer confidence will return over time once individuals adjust to the budget changes.