Late Cold Snap Causes Havoc For Retailers

If you didn’t get around to doing your winter shopping last week, that’s probably a good thing as this week the big retailers like Myer and David Jones and many Aussie brands will be heavily discounting winter merchandise to make room for new stock arrivals.

For the outdoorsy ones the Indian summer has been a bit of a blessing, but local retailers are feeling the pinch from winter’s late arrival.

May’s warmer weather critically affected the sales volumes of winter items like electric blankets, heaters and doonas in the homewares and appliances department, and things like hats, scarves and coats in the fashion sector.

As a result, it’s been quite a terrible season for retail this May. The average maximum temperature in Melbourne for the last week was 19.5 degrees, that’s three degrees above average. While Sydney’s average max was 24.2 degrees, almost five degrees above normal.

Now retailers are stuck with too much stock, which if the weather had been reflective of the norm, would be much more thinned down by now. The problem is that retailers now need to make room for new stock arrivals, and have money to purchase the new stock as well.

Myer and DJs will slash its prices by as much as 50 percent this week for its stocktake sales. Other retailers like Country Road are also offering customers 50 percent off selected items, while high street brands like Bardot, Tony Bianco, Forever New are offering between 20 and 50 percent off selected merchandise. Homewares chain Adairs are offering at least 40 percent off as well. Other retailers like Cue, Witchery and Country Road as well started off its mid-season sales a tad earlier this year, hitting consumers with discounts in April.

As a result, retailers will be squeezing their gross margin to make way for new season spring/summer stock, which usually hits the shelves in August each year.

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