Get the latest retail news straight to your inbox

    Don’t go searching for insights in the retail space, we deliver them direct.
    The week's most important retail news, delivered to your inbox every Friday.
24
Aug-18
Friday

Afterpay targets UK expansion

18
The AFR reported that Afterpay has announced it will enter the UK after a strong start in the US, citing a "retail-led global expansion opportunity" for the payments company. In its first three months in the US, Afterpay has acquired 150,000 customers and 800 US merchants, half of which are currently live with the service. To kickstart its UK focus, the company is raising $108 million in new equity and has acquired UK payments company ClearPay. Afterpay shares have doubled since the start of July sending its market capitalisation to more than $4 billion. Boom times for the millennial shopper favourite.

Woolworths faces $1b backpay claim

5
The Australian Financial Review reported that The Retail and Fast Food Workers Union has launched legal action to terminate Woolworths' enterprise agreement (EA) and make the grocer liable for an estimated $1 billion in alleged underpayments to staff. The union says that the bulk of Woolworths' 100,000 workforce is paid less than the award and claims that the Fair Work Commission relied on misleading material when approving the EA back in 2012. Coles faced a similar action in 2016, which was ultimately settled. Looks like Woolies could be in very costly trouble.
23
Aug-18
Thursday

Lovisa shares take a hit as sales growth slows

9
The AFR reported that despite posting double-digit growth in net profit for FY18, jewellery retailer Lovisa has taken a hit on the stock market, posting its biggest share price drop in two years after a slowdown in same-store sales growth in the first few weeks of 2019. Until this week, the business had enjoyed a strong run on the ASX with shares rising almost three-fold to more than $11, but the stock fell as much as 9.7% yesterday after the MD revealed same-store sales growth had more than halved since year-end.

Wesfarmers' charred remains in the UK?

12

The BBC reported that Wesfarmers' failed UK DIY foray, Homebase plans to close 42 stores and cut 1,500 jobs. Restructuring company Hilco, which bought the DIY chain for £1 in May, confirmed it was planning a Company Voluntary Arrangement (CVA). The retailer, which has 241 stores, said the affected outlets would be shut over the next 16 months. A CVA is an insolvency procedure used by struggling firms to close underperforming shops.

Retail spending soars across Australia

20
The Brisbane Times reported that Queensland is leading the charge as retail spending soars across Australia. Queenslanders are spending on cars, holidays, hotels, motels and retail goods at the highest level in four years. Overall, according to a Commonwealth Bank business sales index report, spending at retail stores has consolidated over the past three months, rising 0.8% a month over the period, with sales up by 16.6% over the year to July 2018, the strongest annual growth rate in 12 years. The report notes that consumers are benefiting from retail deflation, low-interest rates, and job security.

Target US shares surge on in-store boom

11
CNBC posted that shares in Target US surged after the retailer reported unprecedented growth in foot traffic at its stores, along with second-quarter profit, revenue and comparable store sales that surpassed analysts' expectations. The big-box retailer also said that online sales grew 41% from the same period last year, compared with an increase of 32% a year ago. That said, with the strongest same-store sales growth in 13 years, the boom for Target has been in the brick and mortar stores. It looks like the chain reinvented their stores and product mix, but has also succeeded in telling their consumers about it.
22
Aug-18
Wednesday

Lovisa reports double-digit growth

8
In a report lodged with the ASX, jewellery retailer Lovisa posted a 21.4% increase in revenue over of the previous year. The double-digit growth comes off the back of 28 new store openings globally, driving $217 million in revenue for the retailer in FY18, compared to $178.7 million in FY19.

The Reject Shop turns things around

16
A report lodged with the ASX shows that The Reject Shop has posted a 34.3% year on year increase in net profit after tax in FY18. Net profit has gone up to $16.6 million compared to $12.3 million in FY17, but this is on turnover of $800 million, with EBIT at 3%, which is pretty weak. Overall, a relatively flat but competent performance as the business seeks to recover from a challenging 2017, which resulted in a 28% drop in profit.

Super Retail takes on Amazon

14
In a results announcement lodged with the ASX this week, Super Retail Group (SRG) reported a 26% rise in net profit to A$128.3 million, up from $101.8 million last financial year. SRG attributes the results to a $60 million investment in 2018 to build the group's omni-channel retail capabilities – launching click and collect, improving customer delivery times and implementing online price monitoring tools. In FY19, SRG aims to "further defend its turf against Amazon" by increasing investment in e-commerce and spending less on bricks-and-mortar stores. Looking at the amount of money invested versus the return, one has to wonder how commercially savvy is the strategic focus? And, with stores being Aussie retail's best defense against Amazon, is divesting from them the best way to keep Amazon at bay?

Temple & Webster "hopes" to make a profit

29
The AFR reported that pure-play online homeware retailer, Temple & Webster will now target the $50 billion home improvement market as a new source of expansion in an attempt to find its maiden profit this year. Calling a spade a spade, Temple & Webster is an example of a non-profitable business that sucks $70 million dollars (its annual revenue) from the market and gives it away at cost, causing considerable damage in its wake. Not dissimilar to Amazon.
21
Aug-18
Tuesday

Alibaba warns "laggard" Aussie retailers

8
According to an article in News.com.au, Australia is now Alibaba’s third biggest market outside China, behind the US and Japan. But despite its size, the firm seems happy to remain under the radar and isn’t looking to pick a fight with Amazon. Interestingly, Alibaba is one of the fastest growing retailers in the country — working with well-known names from Chemist Warehouse to Woolworths and Kathmandu. The article notes that "In its home market, Alibaba is rolling out vending machines that spit out cars, cash-free supermarkets where your shopping can beat you home and “magic mirrors” where you can virtually try on makeup. In Adelaide, shops still can’t open on a weekend later than 5pm." A top local executive at Alibaba said that "the company's rapid growth Down Under should be a wakeup call to laggard Australian retailers failing to keep pace with their customers."

Nordstrom tests new retail strategies

11
Glossy reported that US department store, Nordstrom is testing new retail strategies to drive sales and promote customer loyalty - starting in Los Angeles, its largest market. The retailer has found that customers who shop both online and in stores spend five times more than customers who shop in a single channel and that customer profitability doubles. As such, the company is investing in new store strategies that can complement its growing online business, including a highly targeted marketing approach, and an improved localised supply chain. The key to Nordstrom's continued success is its holistic view of retail sales, the retailer does not report on in-store and online sales separately. The approach makes good sense. If your customers demand a consistent and seamless “one” brand experience, unifying the client engagement structure of the business becomes the only way to effectively meet and exceed such expectations.