Cotton On co-founder Ash Hardwick said there are still retail sales to be had despite a current tough macro economy.
Speaking with Dexus CEO Darren Steinberg, on the property group’s podcast The Real Deal, Hardwick revealed the fashion retailer saw growth over the recent quarter.
“We just finished our first quarter of the financial year last Sunday, and the quarterly results look like Western Australia, South Australia and Queensland outperformed the country,” Hardwick revealed. “Victoria and New South Wales - obviously the biggest data set - were probably next best and the tough ones were Tasmania and Northern Territory.
However, Hardwick cautioned that the data is a little skewed as it has lots of stores in some states and very few in others.
“But as a whole, bricks is still growing for us,” he said. “It's probably been more challenging in the online and wholesale space for the last three months, and probably that extends through the past financial year as well.
“But the bricks business is performing better than last year across most states, just those smaller ones have been a little bit tougher.”
Hardwick cited its resilient 22-year-old customer for the steady flow of sales, alongside the shopping centre model which he calls the lifeblood of Cotton On since the retailer’s inception.
“We’ve got a really resilient customer, they're absolutely aware of it,” Hardwick said. “The media is not letting them be unaware of it. So it's certainly doom and gloom from a media coverage perspective.
“But for that 22-year-old customer, she's pretty resilient and she's pretty keen to shop and to be out in the shopping centres.”
According to Hardwick, shopping centres have been around for a long time and will continue to be around in the future.
“There are other channels and there are lots of ways to get product to customers now, but certainly I’ve got a lot of faith in the shopping centre model,” he said. “Yes, it's different to what it was in the ‘90s, but as long as it continues to evolve, it's by far the biggest channel that we have, and it's likely to be the biggest channel that we'll have forever.
“We're very much bricks, boots-on-the-ground retail.”
Speaking for online, Hardwick said the online channel is growing despite the challenges, but said it has to find its way.
He said it was a relatively new channel for Cotton On pre-COVID, but then as the pandemic hit and the company closed 1,500 stores globally, online “did its thing.”
“Fortunately, we were pretty advanced in our development of that capability,” Harwick said “It went from being about 10% of our business to 100% of our business. And obviously comping that scenario has been pretty difficult.
“It's been a difficult couple of years post-COVID in the online space, but it's fighting back and it'll always be an important part of our business. I don't anticipate closing 1,500 stores ever again.”