Horse flu hits the bottom line

NATIONAL: Millions of dollars worth of apparel, footwear and accessory sales have gone down the drain in the wake of Australia's crippling horse racing crisis.

The Sydney spring carnival has been officially cancelled due to the worsening equine horse influenza, with Brisbane's race meetings axed until February and fears the Victorian instalment could soon follow suit. At the time of press, Federal Agricultural Minister Peter McGauran was confident the Victorian carnival would go ahead but admitted it would be a "nervous" three weeks as organisers awaited for a newly arrived vaccine to take full effect.

Australian Centre for Retail Studies program director Andrew Cavanagh said while it was impossible to isolate the financial damage this crisis would have on Australian fashion retailers – which account the September and October period for 17.25% of their annual turnover – losses were already numbering well into the millions. He said over the last two years, around $78 million worth of fashion sales had been generated in September and had grown to $145 million in October.

"How much of that is directly attributed to the Spring Racing Carnival is debatable but even if it is only 5 per cent, you are looking at over $11 million in sales," he said.

Figures released by the Victorian Racing Club and recently published in the Courier Mail suggest this figure would be much higher with women in Victoria spending $17.8 million on spring racewear alone.

Regardless, Cavanagh said the impact on consumer confidence was substantial. 

"If the early reports are true, the impact will continue through to February [and] some retailers may not come out the other side of this. Combine this with the normal belt-tightening in the lead up to an election and the timing of the outbreak could not have been worse for retailers."

Owner of Sydney's Holly Golightly boutique Jamall Gideon Mahdi admitted times were already proving difficult. The boutique, which largely stocks party dresses from designers such as Valerie Tolosa, Kate Hurst and Karen Walker, normally generates $60 000 during the September period and at the time of press, had struggled to turn over $15 000.
"The situation right now is abysmal," Gideon Mahdi said. "We've had to get in contact with our customers and offer them 20 per cent discounts on brand new stock. It's killed the season for us completely." 

Sydney-based milliner Katerina Miaoulis said her situation was equally desperate. The founder of Memsahib millinery said she had already lost close to 95 per cent of sales throughout the Australasian region.

"Any milliner who says they haven't lost 95 per cent of their sales is lying. This is a devastating situation that will reach far into the next season with autumn racing in New South Wales severely impacted. Even if the Melbourne Cup goes ahead, it's too late to cater to people's late orders – we need three to four weeks lead time to honour our standards of quality."
Miaoulis said she was worried about the number of suppliers who were now resorting to selling their goods on a consignment basis. 

"Retailers who previously committed to us financially are now looking to these other suppliers for stock. It's harder for genuine milliners who ensure proper lead times and a very dangerous trend for future seasons."   

High-profile Sydney milliner Neil Grigg, who operates his own boutique in Paddington and supplies to Australian department store David Jones as well as private clients, said this had been the worst season in his 25 years in the business. He said turnover was down by 70 to 80 per cent and that his Queensland market had "died completely".
"This is the time of the year when we create things in fifteen seconds and sleep it off in November. It's now quietly scary because I have a shop full of beautiful hats with no-one to buy them."

But Grigg, along with Miaoulis and Gideon Mahdi, has vowed to fight on.

"I've been in this business for twenty five years and built up a very good reputation. I'm not about to fold all that up and go work at McDonalds."

By Assia Benmedjdoub