The Reject Shop hit hard by low spending
The AFR reported that discount retailer The Reject Shop has blamed stagnant wage growth and rising household costs for an alarming drop in sales. The retailer's shares plunged as much as 40% yesterday to 12-month lows after it slashed its December-half net profit guidance from $17.7 million to between $10 million and $11 million. The Reject Shop's CEO blamed, "the extremely weak retail environment". This story confirms what we've noted in today's post about retail challenges in Australia - soaring utility prices have hit discretionary spending hard with serious consequences for specialty retailers.