NATIONAL: A new wave of optimism has led an increasing number of Australian retail groups to throw their weight behind new export markets – at a time when most competitors are battening down
the hatches.
Figures released by the Australian Bureau of Statistics last week showed retailers suffered their worst month in seven years in June, with turnover falling by 1.4 per cent nationally on the tail end of Federal Government stimulus handouts. Fashion and department store sales took the worst battering, recording a 9.3 per cent drop in clothing sales during the month.
Earlier, department store group Myer had been forced to shutter its own international expansion plans with five store openings across the United Arab Emirates and Eastern Europe now delayed indefinitely. Sleepwear chain Peter Alexander also retreated from the US market earlier this year with the credit crunch claiming its three sites in California.
But where some retailers are electing to play it safe on home soil, others have chosen to expand their operations with high street chains Country Road, Cotton On and Metalicus just some of those opening new international sites.
Country Road was among the first to defy the doom and gloom when it forecast profits to soar by 56 per cent for 2008/09. While the Melbourne-based brand’s South African operations are expected to generate $8 million for the 2009 financial year, this could potentially double in 2010 with the launch of its mature market label Trenery across key capitals this month.
Country Road marketing manager Jacqui Moore said 17 concessions had already been locked in for an official launch date of August 20. The Trenery brand will be available in areas that target affluent shoppers such as Sandton City in Johannesburg and the Victoria & Albert Waterfront and Cavendish Square in Cape Town.
Country Road first launched into the South African market in 2008 with four concessions secured through its parent company Woolworths. Moore said positive sales results meant 14 concessions across men’s, women’s and accessories would be in operation by the end of this month.
“We are pleased with the performance of Country Road in South Africa,” she said. “We recognised an opportunity to launch the brand in the region, partly due to the similarity in climate and lifestyle but also due to Woolworths’ extensive, high quality and highly trafficked retail footprint.
“Further expansion [of Trenery] will be considered based on customer acceptance of the brand.”
Melbourne-based powerhouse Cotton On Group – which operates 61 international stores and 510 in total – has also remained undeterred in the face of a recession.
Marketing manager Emily Checinski said the retailer plans to open its first US store by Christmas and drive expansion into Malaysia and mainland China next year. The group plans to helm a total of 2016 stores across eight retail concepts by 2016.
“Being a ‘value’ fashion retailer, we find the economic climate can often work in our favour – this is how we started in 1991,” Checinski said. “Our decision to expand internationally was a case of simple maths and a bit of confidence. Our product offering is on trend, not too fashion forward, accessible and simply great value. We’ve found the majority of our customers look for at least three of these four aspects, and this same market is not too dissimilar overseas.”
Recent international store openings included Rubi Footwear and Cotton On Kids in Singapore. The company does not operate a wholesale arm but has distribution centres located in key capitals across Asia.
PAS Group-owned and -operated retailer Metalicus, which has grown from five to 11 national stand-alone stores over 2008/09, is another that plans to double its global presence over the next 12 months. In addition to distribution channels through department stores Myer and David Jones, the brand has close to 200 accounts across Russia, Japan, New Zealand, the UK, the US, Canada and South Africa.
Metalicus paraded its wares alongside national retailer Seduce at trade event G’Day USA earlier this year. Marketing manager Elise Ross said as a result 40 global accounts had been secured. “We’re most certainly looking to push and grow our label in the US but also looking at newer regions such as Asia, which we haven’t really penetrated – we’ve gotten a really great response from our international distributors.”
Ross said the brand had weathered tough trading conditions in Australia by emphasising its basics and tailored collections. Metalicus opened its most recent store at Sydney’s Queen Victoria Building and was “always” on the hunt for new and premium sites, she said.