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In a move that many industry professionals and consumers have been waiting on for years, Afterpay Australian Fashion Week (AAFW) finally showcased plus-size labels in a dedicated runway called The Curve Edit last week, featuring pioneer plus-size supermodel Robyn Lawley.

The Curve Edit showcased six designers that catered from sizes 12 to 26 and a bevy of local curve models from talent agency Bella Management, which organised the showcase. Brands that showed on the runway included Vagary, Harlow, Embody Women, Zaelia, 17 Sundays and Saint Somebody.

According to fashion industry expert and consultant Rosanna Iacono, The Curve Edit was “a gamechanger for size diversity” during AAFW. 

“This runway as part of the official schedule was instrumental for driving the conversation around how curvy fashion needs to be integrated with mainstream fashion, within the the key events on the industry calendar,” she told Inside Retail. 

“But what was also very encouraging was the fact that numerous other designers incorporated plus-size models in their shows during the week.” 

Indeed, other labels outside of The Curve Edit that featured a range of body shapes and sizes included Gary Bigeni, Nicol and Ford, Dyspnea, Mariam Seddiq and Iordanes Spyridon Gogos.

In recent years, AAFW has been criticised for its lack of size diversity, making The Curve Edit a welcome change. However, entrepreneur and curve model Blaise McCann pointed out that ideally, in the future, inclusion would be embraced across the week’s schedule and all labels. 

“Although the show was groundbreaking, there is always more that can be done to bring inclusivity into the fashion world in a more authentic capacity,” she wrote in an Inside Retail article. “Instead of settling for a separate show that requires a supermodel to garner attention, it would better serve not only the curve community, but also the Australian fashion community to normalise and include all bodies in all shows.”

Iacono expressed similar sentiments.

“Eventually, we’ll be seeing many more designers simply integrating a broader range of sizes into their sample collections, to be able to showcase them not only on the runway, but in other photographic shoots and showroom settings,” she said. 

“We need to get to the point where size diversity is simply a hygiene factor, and always to be expected. But there is still a way to go before we reach peak integration and normalisation of size diversity.”

Australian consumers are set to spend $8.8 billion during the coming months as mid-year seasonal sales ramp up and excess stock is sold. 

The Australian Retail Association (ARA) forecasts 52 per cent of consumers shopping mid-season sales will be doing so online. Around 6.2 million Australians will spend an average amount of $1420 each. 

NSW is expected to contribute $3.2 billion followed by Victoria at $1.9 billion and Queensland at $1.7 billion.

The ARA said its research shows 83 per cent of consumers plan to spend during the mid-year sales – and they say they will spend the same or more than they did last year.

ARA CEO Paul Zahra is encouraging consumers to head into the CBD for their mid-year sales shopping and support businesses impacted by low levels of foot traffic. 

“With tax time around the corner, savvy consumers will also be on the lookout for work-related products which they can then claim from July 1, so we expect products like computers, phones and tablets to be popular purchases,” he said.

Zahra added that prices will be slashed across a range of products from fashion, shoes and accessories to electronics, bedding and homewares as retailers clear stock to make way for new season lines in the next financial year.

Australia’s retail sector has been warned to prepare for a tough period ahead as the compounding pressures of inflation, weak consumer confidence and worsening COVID case numbers threaten to send spending plummeting.

Most retailers enjoyed an unprecedented boom in consumer spending during the pandemic, notably online as government stimulus fuelled buying during lockdowns. However, last week market analysts cautioned their clients that the COVID-induced sugar hit appears to have well and truly worn off.

Tom Kierath, analyst for investment bank Barrenjoey, told The Age and The Sydney Morning Herald both suppliers and retailers had started to raise the alarm over worsening retail conditions. Discretionary spending has dropped 10 per cent over the past month, and conditions are unlikely to improve anytime soon.

“We’ve been predicting for a while that the retail would come off as people start to spend their money elsewhere, but feels like now it’s actually happened,” he said. “And it’s going to get tougher because the pressures on the consumer are getting worse.”

Retailers have warned shoppers and investors about rising costs over the past 12 months. However, this year has brought inflationary pressures sharply into focus, with raw material shortages, fuel price spikes and shipping cost increases all contributing to the highest level of annual inflation in the past two decades.

Compounding this are further pressures affecting shoppers’ wallets, including rising interest rates and power prices. The reopening of international travel has also prompted more spending in non-retail categories.

Retailer Mark Mezrani, who operates 50-odd Kidstuff stores around the country, agrees that any COVID-related benefits for retailers appear to have worn off, and the outlook is increasingly grim.

“There’s no doubt the Australian consumer is starting to get the message that the party’s over,” he said. “The things that were fuelling spending – government support, low interest rates, low energy prices, house prices rising – every one of those indicators have now reversed.”

“Coupled with the current labour shortages, supply disruption, and massive price increases in shipping costs, it doesn’t bode well.”

Already, international retailers have started to report signs of a marked slowdown in consumer spending, with US behemoths Walmart and Target both recently reporting weak earnings and warning of a downbeat environment to come.

These results could be a canary in the coalmine for the Australian retail sector according to Jarden analyst Ben Gilbert, who believes local retailers run around three months behind their international peers.

“While the US is a different market, we see the directional trends as relevant for Australia given similar themes with respect to inflation, down-trading and reopening are likely to play out, to an extent, in the 2023 financial year,” he said.

Gilbert views discretionary and household-related retailers as facing the most risk from this scenario, highlighting JB Hi-Fi, Harvey Norman, Premier Investments and Wesfarmers as companies that could disappoint investor expectations.

However, it’s clear that many investors are already expecting downbeat results, with most retail companies having almost entirely retraced the gains made in their share price throughout COVID. Some market darlings, such as online retail Kogan, are now trading lower than they were before the pandemic.

Mezrani says his business has “reluctantly” been forced to raise prices and is still struggling to get consistent labour in stores, saying there are precious few positives on the horizon for retailers.

“If you had to pick the settings you want for good retail spending, they’re the exact opposite of where we are now.”

Year-on-year retail sales growth hit 9.6 per cent in April year-on-year according to data released by the Australian Bureau of Statistics.

Sales reached an estimated $33.9 billion in-store and online combined during the month, with the cafes, restaurants, and takeaway services, along with clothing and footwear sharing a 14.7 per cent increase, and the ‘other retailing’ sector 14.4 per cent. Household goods amassed a 7.4 per cent increase while food retailing registered a 6.5 per cent increase. Department-store sales recorded the slowest rise, of 5.4 per cent.

The easing of public health restrictions and removal of density limits in stores and malls boosted trade in Queensland and gave rise to a 11.8 per cent increase in retail turnover.

On a state basis, Western Australia recorded a 10.2 per cent increase, Victoria 9.9 per cent and South Australia and NSW 8.6 per cent.

Australian Retail Association CEO Paul Zahra described the month as ‘phenomenal’ for retailers overall.

“With trade boosted by the Easter long weekend, many people got away for holidays, which coincided with a relaxing of domestic border controls and Covid restrictions on businesses,” he said.

“However, we know that the record retail sales result can also be attributed to the higher prices we’re seeing across the economy – particularly in the food industries. While sales are increasing, so too are business costs, while staff shortages remain an ongoing concern.”

Ben James, director of quarterly economy wide statistics at the ABS, said strength in retail turnover is being driven by spending across the food sectors.

“High food prices have combined with increased household spending over the April holiday period as more people are travelling, dining out and holding family gatherings.”

UK-headquartered online fast-fashion retailer Missguided has collapsed after a last-minute rescue backed by rival Boohoo – and potential bids by Shein, JD Sports and Frasers Group – all fell through.

The company has appointed Teneo Financial Advisory – the agency trying to negotiate a sale of the ailing business – as administrator. Teneo says the business will continue to trade while its future is determined, but The Guardian reported more than 80 staff were immediately made redundant with another 260 jobs at risk if the company cannot be salvaged. 

Missguided owes millions of pounds to suppliers, who lodged a winding-up petition on Monday. 

“The joint administrators will now seek to conclude a sale of the business and assets, for which there continues to be a high level of interest from a number of strategic buyers,” said Teneo senior MD Gavin Maher. “As we continue to see, the retail trading environment in the UK remains extremely challenging.”

Described by Retail Gazette as once being “an online fashion success story” Missguided had “failed to keep pace with bigger competitors Boohoo and Asos in recent years”. 

Founded online in 2009, Missguided seemed to start off well in the digital space, but a foray into brick-and-mortar retailing from 2016 appears to have ultimately sealed its fate. After closing a flagship store in Westfield London with two years of its lease left in February 2019, the company began to pursue an overseas expansion program, opening stores in markets as diverse as the UAE, Vietnam and Egypt under distribution partnerships. It had an Australian online storefront which is currently unreachable.

Late last year Alteri, an investment company that specialises in distressed businesses, took a 50 per cent stake in Missguided in return for emergency funding. When founder Nitin Passi resigned as CEO, Alteri called in Teneo to advise on long-term rescue options. 

Passi launched the company using a loan of £50,000 from her father, an Indian immigrant who made a fortune in the rag trade by setting up a high street supplier By Design in the 1960s. 

The Guardian has reported that some UK suppliers are on the brink after not being paid by Missguided, including a Leicester-based factory that is owed more than £2 million and forced to lay off 90 staff because he could no longer pay them. He claimed not to have been paid since April.

“This is completely unethical,” he told The Guardian. “I am absolutely disgusted.”

Treasurer Jim Chalmers has reset the economic narrative, labelling a solid quarterly economic growth figure and booming national income as “weaker than expected”⁣ and warning of “big challenges”⁣ ahead for the economy.

Gross domestic product rose a respectable 0.8 per cent in the March quarter as the economy increased production of goods and services 3.3 per cent over the year.

Economists variously labelled the result “very strong”, “strong”, “solid” and “firm”, but Dr Chalmers used his first national accounts press conference to describe the result as “weaker” than the budget forecasts and “a snapshot of the really serious constraints and challenges that we have in our economy”.

Although he acknowledged that parts of the economy were “robust”⁣ and “resilient”⁣, including the unemployment rate at a 48-year low of 3.9 per cent, the treasurer sought to focus attention on the “big challenges”⁣ of inflation, falling real wages, rising interest rates and worsening cost of living.

He cited petrol prices – up 12 per cent since the end of April; wholesale electricity prices – up 237 per cent, and household power bills set to rocket; and gas prices – up more than 300 per cent over recent years.

Stick to new COVID-19-era habits, or go back to the old ways of doing things? For most US consumers, the answer seems to be “both.” Two years into the pandemic, people across the country have discovered that they like shopping online, but they’re also going back to brick-and-mortar stores. They’re venturing out of their homes again, but they’re continuing to spend money on home improvement. And—in what could be boon or bane for manufacturers and retailers—today’s consumers are quite willing to abandon their once-preferred brands in favor of new ones that offer value or novelty.

This article highlight findings from the latest Consumer Pulse survey, which was in the field between February 25 and March 1, 2022, and garnered responses from more than 2,100 US adults (sampled and weighted to match the general US population). The survey results, combined with third-party data on consumer spending, provide insights into how US consumer sentiment and behavior have been evolving since the COVID-19 pandemic began. And the evolution continues: this survey did not address the invasion of Ukraine in any form. We believe, therefore, that the results do not capture the full effect of the invasion on US consumer sentiment.

It remains to be seen how—and how intensely—recent geopolitical and economic developments will affect US consumers’ outlook. What’s clear is that, more than ever, companies must stay on top of consumers’ fast-changing attitudes and behaviors.

Inflation hasn’t stopped consumers from spending—yet. 

In the early months of 2022, amid record inflation, US consumers continued to open their wallets. US inflation grew to nearly 8.5 percent in March 2022, with the May 2021 to March 2022 period showing the highest inflation in a decade. Yet, US consumers spent 18 percent more in March 2022 than they did two years earlier, and 12 percent more than they were forecast to spend based on the pre-COVID-19 trajectory.

This loosening of purse strings was perhaps not surprising: US consumers had approximately $2.8 trillion more in savings than they had in 2019, and many didn’t hesitate to dip into those savings as pandemic restrictions eased across the country. But it isn’t just the savers who have been making purchases: credit card debt is starting to rise as well. People in every age cohort and income group spent more of their money, but year-over-year spending growth was highest among millennials (17 percent) and high-income consumers (16 percent). That said, consumer sentiment began to dip in late February, as we discuss further below.

Consumers continue to spend more on certain product categories, but inflation is slowing volume growth. 

In some categories, much of the growth in spending in February and March 2022 was because people bought more; inflation accounted for only a small portion of growth. This was especially true in categories that boomed during the pandemic: sporting apparel, pet supplies, cosmetics, and software and electronics. But in other categories—including gasoline, restaurants, and travel—inflation has masked a drop in volume of consumption. Consumers bought mostly goods rather than services or experiences. Spending on goods was higher than prepandemic levels, whereas spending on services was still 2 percent lower than it was prepandemic—a pattern that will likely continue until more people feel comfortable being in crowds and attending public indoor events.

In light of persistent inflation and the war in Ukraine, consumer confidence—which rose steadily through 2021—dipped in February 2022. Only 38 percent of survey respondents said they feel optimistic, down from 44 percent in October 2021. The steepest drop in consumer sentiment was among high-income consumers, a group that frequently traded up to more-expensive products and brands in 2020 and 2021 but that might soon moderate what it buys. Companies will need to figure out the value equation that high-income consumers find most compelling: Will they continue to spend but start to trade down more than they did in 2020 and 2021? Will they shift more of their spending to channels providing better value?

The “loyalty shake-up” continues. 

More US consumers reported switching to different brands and retailers in 2022 than at any time since the beginning of the pandemic—and most of them say they intend to incorporate that behavior into their routines. Their reasons? With inflation at a record high, more people are looking for value; price is at the top of the list of consumers’ motivations for switching. Almost all consumers—90 percent—have noticed that prices are going up. In particular, they’ve noticed significant price hikes in two things that many people buy multiple times a week: gasoline and groceries. Among consumers who said they’ve switched brands, slightly more than a third said they opted to buy private-label products.

Availability, which was a big reason for switching in 2020 and 2021, still matters a lot but is less of a differentiator than it was at the height of the pandemic, when some brands couldn’t keep up with demand and were constantly out of stock. Meanwhile, brand purpose is now less of a buying factor for consumers than it was in 2020. Novelty, on the other hand, has steadily risen in importance. Consumers are keen to try something different, making innovation an imperative for brands that want to win (or win back) consumers. Combining innovation with the perception of better value could be a particularly attractive offer.

Shoppers are spending more both online and in stores. 

People began shopping online in droves at the start of the pandemic, when they didn’t have much of a choice. But it turns out that many people enjoy the convenience that e-commerce offers. Even when brick-and-mortar stores reopened, spending in online channels continued to climb. Year-on-year growth in e-commerce was 27 percent in March 2022; the total uplift in e-commerce penetration, from the onset of COVID-19 until March 2022, was 33 percent.

Contrary to what some in the industry predicted, the rise in e-commerce hasn’t made brick- and-mortar retail obsolete. In fact, in-store spending is recovering at a healthy clip—with 8 percent year-over-year growth in March 2022, compared with approximately 5 percent in early 2021. Providing a seamless experience in both online and offline channels is becoming table stakes for brands and retailers. In addition, companies would do well to differentiate the service and experience of in-person shopping, while giving consumers reasons to continue to visit their websites and apps.

Omnichannel shopping is becoming the norm. 

Seventy-five percent of US consumers say they’re researching and purchasing both in-store and online. And this omnichannel behavior isn’t confined to a few types of products: consumers are doing it for both food and nonfood purchases across a broad range of categories. What’s more, 45 percent of consumers say social media is influencing their purchases.

Not surprisingly, social-media influence is heaviest among younger people and is most relevant in appearance-related categories such as cosmetics and sports apparel. Social commerce, already a phenomenon in China, is still nascent in the US market, but one in ten omnichannel shoppers said they’ve already made purchases directly via social media. It’s a channel that’s only growing in importance—yet too many consumer and retail executives today still haven’t taken the time to educate themselves in social media and thus are missing out on powerful opportunities to reach and engage consumers.

Even as people go out again, their “nesting” continues. 

More than half of US consumers have already resumed their normal out-of-home activities; another 20 percent are in the process of returning to their prepandemic routines outside the home. Almost 40 percent of survey respondents report that they’re now exclusively working in an office or other workplace outside the home. On average, consumers are working from home only about two days a week. But about one-third of consumers say they aren’t yet comfortable attending public indoor events.

Interestingly, despite resuming most of their out-of-home activities, US consumers haven’t pulled back on making their homes more attractive and comfortable. Spending on home improvement and maintenance is still growing: it’s 11 percent higher than pre-COVID-19 projections even after adjusting for inflation. Given the overall shift in the way people have used their homes during the pandemic as well as many people’s expectations of continuing to work from home at least one day a week, companies can expect this nesting behavior to continue.

Consumers say they care about ESG, but it means different things to different people. 

When choosing which brands to buy, consumers—in particular, younger generations—say that their choices are at least somewhat influenced by environmental, social, and governance (ESG) factors. More than two-thirds of younger survey respondents said at least one aspect of ESG is very important to them. Paramount among their concerns is that companies are transparent and show that they care for people (employees, customers, others in their communities).

In general, younger consumers prioritize authenticity and social issues such as diversity, equity, and inclusion, whereas older consumers pay more attention to health and environmental issues. Today, with inflation driving many consumers to switch brands—value has become more of a motivator than values, so to speak—companies that can deliver on consumers’ expectations for both value and values will be best positioned for success.

The chief executives of Australia’s two largest private employers have thrown their support behind an increase in workers’ wages amid persistently rising inflation and a tightening labour market.

Woolworths boss Brad Banducci and Wesfarmers managing director Rob Scott both made comments on Tuesday supporting wage rises, with Banducci backing calls from industry body the Australian Retailers Association for an increase in the minimum wage in line with the underlying rate of inflation.

Scott, who oversees the operation of major retailers Bunnings, Kmart and Target, told the Macquarie Australia Conference he expected to see rising wages “across the board” in the year ahead, something he welcomed in light of the rising level of inflation.

“From a Wesfarmers point of view, I see real wage growth as a very good thing. Real wage growth is a good thing for the economy, and if it’s good for the economy, it’s generally good for Wesfarmers,” he said.

Banducci, whose company employs about 200,000 Australians, was also supportive of wage rises, though noted that there was no “silver bullet” that would fix Australia’s inflation woes. The retailer said shoppers could be facing a double whammy of price rises from suppliers in the next 12 months.

“We’re very clear that while we need to deliver value for our customers, we also need to make sure that our team can have salaries and wages that keep pace with the underlying increase in the cost of living,” Banducci said.

The supermarket boss said so far around 40 per cent of the company’s supplier base had requested price increases, and the supermarket was in negotiation with an additional 20 per cent. At Woolworths’ third-quarter sales results on Tuesday, the company reported inflation across its food business of 2.7 per cent, lower than rival Coles’ 3.3 per cent.

“There are indications from some of our larger suppliers that within 12 months, they will come back for a second cost increase,” Natalie Davis, Woolworths’ head of supermarkets told analysts. “That’s really reflecting the ongoing cost pressures they’re seeing on commodity prices, manufacturing costs and international freight.”

Banducci’s remarks supporting wage rises are at odds with other retail bodies and fellow supermarket executives, with Coles’ boss Steven Cain warning last week of the danger of wages rising in tandem with inflation, as he called for an increase in immigration rates to offset rising prices.

The comments come as Woolworths reported a strong start to the new year, with sales from January to March rising 9.7 per cent across the business to $15.1 billion. This included comparable growth of 4.4 per cent at the company’s key supermarket division to $11.4 billion, ahead of analyst estimates.

Despite these strong sales results, Banducci said the quarter had been challenging, with floods, supply chain disruptions and high levels of COVID-related absenteeism hurting the supermarket’s standing with customers.

However, the company said trading had been strong so far in the fourth and final quarter of the financial year, with the business now focusing on “returning to a more stable operating rhythm.”

Costs relating to COVID-19 have continued to fall, coming in at $66 million for the quarter, with the business saying it is continuing to look at cutting additional pandemic-related costs where possible.

On Tuesday, the Reserve Bank raised interest rates by 0.25 percentage points to 0.35 per cent, the first-rate rise since 2010. Speaking ahead of the decision, Banducci would not comment on what this might mean for shoppers, saying instead the supermarket was focused on “delivering value for customers”.

Shares in Woolworths had gained 0.6 per cent on Tuesday by mid-afternoon but fell in line with the broader market following the RBA’s decision.

Online furniture retailer Temple & Webster is moving into the home improvement and DIY market with an online store aimed at challenging the dominance of Australia’s biggest hardware chain Bunnings.

The company plans to spend $10 million over this financial year and the next establishing The Build, an online store selling home improvement products such as ceiling fans, lighting fixtures, bathroom vanities and wallpaper. Further categories, such as tools and building equipment, will be added over the coming months, Temple & Webster told its shareholders on Wednesday morning.

The retailer announced the plans as it updated shareholders on its trading performance through the second half of the 2022 financial year so far, with sales up 23 per cent for January through to the end of April. The company expects its earnings margin to be around 3 per cent for the full year.

Investors weren’t impressed, sending the stock down 6.7 per cent to $5.04 in late afternoon trade.

The expansion into home improvement is a notable deviation for the online furniture retailer, which has established itself as a significant player in Australia’s home goods market during the pandemic, thanks to a boom in demand for home office equipment such as desks and office chairs.

Chief executive Mark Coulter said the move was a “natural extension” for the ASX-listed business as Australians were drawn to home improvement projects.

“Australia is a country of home renovators, we love our homes, and we love making them more beautiful,” he said. “We believe our expertise in ecommerce and the home will help make The Build become Australia’s first-stop shop when it comes to renovating and redecorating.”

The market for online improvement in Australia could be worth around $16 billion and the category was yet to make its mark online, with just 4 per cent of DIY shopping happening online compared to around 25 per cent in the UK, the company said.

Investors were sceptical, with RBC Capital Markets analyst Wei-Weng Chen saying the company’s sales were tracking well below estimates and that shareholders would look upon the launch of The Build with caution.

“While the total addressable market, margin opportunity and online-penetration story for the home improvement category looks attractive in the medium [and] longer term, we expect the market to approach the launch [...] with an element of caution, given the current macro headwinds facing the Australian property market,” the analyst said.

The company will also face a tough job when squaring off against Wesfarmers’ Bunnings juggernaut, which - despite only recently launching an online store - holds around 50 per cent market share for home improvement in Australia.

Perhaps in recognition of this, Temple & Webster said it doesn’t expect The Build to make a material contribution to its overall sales and earnings for the first four years. However, it expects the long-term-margins for the business will be better than its furniture and homewares category.

The boss of national retailer JB Hi-Fi has said he doesn’t believe rising interest rates will affect spending at his electronics chain as phones, laptops and tablets have become essential purchases for many consumers.

JB chief executive Terry Smart told the Macquarie Australia Conference on Wednesday that many of the products sold by the ASX-listed retailer were now “integral” to people’s lives, and that he didn’t expect consumer spending to falter even as cost of living pressures increase.

“A lot of our categories ... are becoming less discretionary. People can’t live without it, it’s such an integral part of their lives that they’re continuing to buy,” he said. “We’re still going to see that, I would like to think, during [rising interest rates].

“And if it’s really going to get tough, we’re a discount retailer. Customers trade down to where they absolutely know they’re going to get the best deal, and that’s going to be both JB and The Good Guys.”

Smart’s comments come as JB Hi-Fi reported continued strength in its sales for the first four months of the new year, with trade at its Australian business increasing 11.9 per cent from January through to the end of April.

Revenue at the Good Guys was also up, gaining 5.5 per cent for the period, and the company’s historically troubled New Zealand business also performed well, increasing sales by 4.8 per cent. Morgans analyst Alexander Mees said JB Hi-Fi’s result was the best third-quarter result out of the major retailers so far.

“The evidence from discretionary businesses like JB, Breville and Super Retail yesterday paints a more positive picture of consumer spending in the face of rising inflation than share prices would have you expect,” he said.

“It wouldn’t be the first time the stock market has underestimated the resilience of the Australian consumer.”

However, despite this, JB Hi-Fi’s shares fell 4.3 per cent to $49.95 by mid-afternoon on Wednesday, as the company also warned investors about supply chain delays and inventory availability moving into the last quarter of the financial year.

Retailers across the board have warned about the effects of rising inflation, with both heads of major supermarkets Coles and Woolworths warning that customers could expect the price of their weekly shop to increase notably.

However, this was not the case for Smart, who said while JB had seen price increases flow through from suppliers over the last six months, the hikes were largely “hidden” in consumer electronics as manufacturers roll out new models that are naturally priced higher.

“[Inflation] is not going to impact our promotional activity going forward because we buy from multiple suppliers, they all compete against one another as well,” he said.

Smart also warned that JB’s famously low cost of doing business could take a hit in the months ahead as more and more customers return to shopping in-stores, requiring the retailer to spend more on staff to ensure service levels are up to scratch.

Australian casual youth apparel retailer General Pants Co has been bought by Alquemie Group, the retail investment platform of private-equity company Acta Capital. 

General Pants Co CEO Sacha Laing will take on the role of group CEO at Alquemie and current shareholders including Victor Smorgon Group, Phil Staub and Jackie Vidor, have agreed to reinvest “a significant portion of their proceeds” into Alquemie, the company said in a statement. Laing has previously held leadership roles at Colette, Country Road Group and David Jones. 

Founded in 1972, General Pants Co sells brands including Lee, Subtitled, Ksubi, and Tommy Jeans through a network of 60 stores across Australia and New Zealand. The company will join Lego Certified Stores, Ginger & Smart, SurfStitch and Pumpkin Patch in Alquemie’s rapidly growing portfolio, with further acquisitions planned. 

Acta Capital founder and CEO Richard Facioni said the acquisition gives Alquemie “significant scale and breadth of operations” as it seeks to partner with “exceptional, like-minded management teams to build great businesses”.

“General Pants Co is highly complementary to our existing portfolio and positions Alquemie for continued growth as we build a leading multi-channel retail investment business,” he said in a statement. 

Laing described it as a privilege to join Alquemie at a pivotal time and said she was looking forward to working closely with Facioni.

Discount department store Big W has partnered with recycling platform TerraCycle to launch a toy recycling scheme in all 176 stores nationwide.

After a trial in limited stores, the retailers’ Toys for Joy program collected over 18 tonnes of old toys.

The two companies say around 26.8 million toys are discarded in Australia every year, the majority placed in normal rubbish as they are not kerbside recyclable.

Big W MD, Pejman Okhovat says the program aims to reduce the number of toys that end up in landfills.

“Toys for Joy provides parents peace of mind knowing that as they declutter, they are disposing of old toys in a manner that helps to reduce landfills,” he said.

Jean Bailliard, GM of TerraCycle Australia, has praised Big W for providing an in-store recycling solution for parents.

“The program not only saves worn-out toys from landfill, but our recycling process also takes complex materials like metal, rubber and a variety of plastics and turns them into new materials for reuse.”

The program has also received praise from the environment minister, Sussan Ley. She said initiatives like Big W’s will change the national conversation around recycling.

Big W customers are encouraged to drop their pre-loved toys in the Toys for Joy chest placed in front of all Big W stores. Books, stationery, paintbrushes, playdough, board games, batteries, or oversized and wooden toys are not accepted.

Adidas lowered expectations for 2022 after a first-quarter slump as renewed Covid-19-related lockdowns in Greater China continue to hit the German sportswear company.

First-quarter currency-adjusted sales shrank by 3 percent worldwide, to 5.3 billion euros ($5.58 billion), while profit from continuing operations fell 38 percent, to 310 million euros, it said on Friday.

In Greater China, sales collapsed by 35 percent in the first quarter; for the year, revenue is expected to fall significantly due to store closures and strong traffic declines.

The company now expects to come in at the lower end of its 2022 forecast for an 11-13 percent increase in currency-neutral sales as well as for net income from continuing operations of between 1.8 and 1.9 billion euros.

Adidas also cut its operating margin forecast, saying it will remain at the previous year’s level of 9.4 percent instead of increasing to 11 percent.

“In this environment, characterized by severe external challenges, it is imperative to stay focused on our strategic objectives,” said Chief Executive Kasper Rorsted.

“While we will remain agile, we will not jeopardize our long-term growth opportunity for short-term profit optimization.”

The company expects a return to growth in the second quarter despite the continued sales decline in Greater China and a 200-million-euro negative impact from supply chain constraints.

In the second half of 2022, net sales are expected to grow over 20 percent, driven, among other things, by unconstrained supply, strong momentum in Western markets and major sports events.

Global online fashion retailer SHEIN is set to hold its first ever pop up shop in Australia, from May 13-15 in Melbourne.

SHEIN is an international B2C fast fashion e-commerce company that mainly focuses on womenswear, but also offers men's apparel, children's clothes, accessories, shoes, bags and other fashion items.

The pop up will showcase SHEIN’s Autumn Winter 2022 clothing and accessories which cover all ages, genders and sizes.

It will include some of the brand's newest collections including SHEIN X (its collaboration with emerging designers), EMERY ROSE (a boho collection), DAZY (an asian-fashion inspired collection), SHEGLAM (beauty collection) as well as home products and its pet clothing range PETSIN.

“We’re thrilled to be hosting our first ever Australian pop up and offering our Australian customers the opportunity to shop the collections in-store,” a SHEIN spokesperson said.

SHEIN has previously held pop up stores in New York, Los Angeles, Berlin, London and Singapore and is now heading here.

The pop-up shop will be located at 340 Flinders St, Melbourne, and will be open from 10am-6pm from Friday, May 13- Sunday, May 15.

Founded in 2012, SHEIN is a leading global online retailer with key operation centres in Guangzhou, China, Singapore and Los Angeles, along with other major markets. 

Jo Horgan is a talker. In her British accent, with vowels that remain unflattened despite living in Australia for almost four decades, Horgan talks and talks. Three times over the course of our conversation, politely inquiring members of her inner circle try to wrap us – her – up.

The first time, she waves them away, equally polite. The second, she invites them to sit. By the third time it’s clear to everyone that she has run out of excuses. “Right. I’m being cheeky now.”

By turns breathlessly effusive and pensively introspective, Horgan speaks with speed and obvious delight and then, shifting gears, she talks slowly and deliberately, selecting each word as if from a shelf in front of her. And yet she speaks. And she speaks. Because Jo Horgan has quite a lot to say.

The boom in online shopping that dominated the first two years of the pandemic is starting to unwind, as shoppers freed from lockdowns head back into bricks and mortar retail stores.

The pure-play e-commerce sharemarket darlings are having a tougher time also as supply chain disruptions and hefty shipping and freight costs eat into profits.

One of the highest-profile e-commerce companies, Kogan.com was severely punished again on the stockmarket on Friday as profits slipped in the three months ended March 31. Kogan.com is also still carrying large amounts of inventory in warehouses as a buffer against potentially long delays for some orders, which is weighing on profits.

Kogan.com founder and chief executive Ruslan Kogan said on Friday there had been a general slowdown in e-commerce across the market in the March quarter, as he foreshadowed a crackdown on costs in the business to preserve profit margins.

“Over the coming year, the company will be recalibrating its organisational costs in line with current growth levels to support a return to the historical operating margins previously generated,” Mr Kogan said.

Apparel and footwear retail companies Brand Collective and PAS Group are to merge, creating Australia’s third-largest fashion retail group. 

The deal, effective April 26, will aggregate 26 brands and 15 character licences, operate in 300 retail locations across Australia and New Zealand and employ 3000 staff. The company will also run some 250 wholesale accounts both locally and internationally. 

Trading under the Brand Collective banner, the business will boast revenue exceeding $600 million.

The newly combined Brand Collective is in the top three retailers in Australia with combined revenue of more than $600 million generated from its 26 brands and 15 character licences. 

The portfolio of brands will include Clarks, Hush Puppies, Shoes & Sox, Superdry, Replay, Review, Black Pepper, Yarra Trail, Everlast, Lonsdale, Julius Marlow, Grosby, Mossimo, Marco Polo, and Volley. 

The Brand Collective headquarters will relocate from Port Melbourne to Cremorne where PAS Group is currently located, the two businesses consolidating in one location in “campus-style” premises. 

Eric Morris will be CEO and Lisa Shalem, previously GM at Shoes & Sox, will assume the role of executive GM of the footwear division. 

Inside Retail understands that Brand Collective’s existing CEO Caleb Brown will be leaving the business. 

Larry Kestelman, of Brand Collective parent LK Group, said the merger would allow the group’s brands to continue to grow and “achieve their full potential”. 

Morris said the company’s Designworks division supplies products to department stores and discount department stores, while Shoes & Sox is the leading children’s footwear retailer in Australia, dominating the children’s footwear category in Myer. Brand Collective plans to expand the Shoe Warehouse network. 

“We will be working hard to grow the business through both continued organic growth and complementary acquisitions.”

The managing director of book retailing group Dymocks says book sales across the industry are continuing to grow in the early months of calendar 2022 even as economies fully open up, with part of the rise stemming from newer social media platforms like TikTok.

Mark Newman, who has been running Dymocks in Australia for two years, said industry sales are up 2 per cent in the first few months of 2022, after a stellar 8 per cent rise in 2021.

The “at-home” lifestyle in the pandemic had been a large reason for the jump, but there are powerful social media forces at work where TikTok users like to show themselves with the book they are reading, or about to read.

“It’s partly being driven by TikTok,” Mr Newman said.

TikTok users are posting using the hashtag #BookTok.

“Books and reading books has actually become ‘cool’ again,” he said.

He said there had been a strong upturn in book sales last year as people sought to read more when stuck at home.

“People have spent so much time on screens,” he said.

“Ultimately, books are entertainment.”

But bricks-and-mortar players were hit by trading restrictions which meant foot traffic was down in the depths of the pandemic, similar to retailers in other segments.

Mr Newman, who is in Adelaide to open a new $3.3 million Dymocks superstore on Wednesday in the old Regent Theatre building off Rundle Mall, believes the omnichannel approach is the right one to drive maximum growth.

Dymocks operates 50 stores, which is down from a peak of about 80 outlets when the business was almost exclusively bricks and mortar.

“Consumers, authors and publishers all want physical bookshops to continue to thrive,” he said.

Having large flagship stores is important for continued customer growth, because many people love to browse or read a couple of pages before they commit to a purchase.

He said online sales across Dymocks are at about 15 per cent of total sales. Before the pandemic, online sales across Dymocks was about 5 per cent. Mr Newman said Dymocks does not have an aspiration for how high the online penetration might reach.

“I think it’s difficult to say. We’re ready for it to be whatever it becomes,” he said.

Mr Newman said the new Regent Theatre superstore, which covers 980 square metres and includes three 10-metre high curved wooden arches as design features to draw customers’ eyes back to the bookshelves and off the ornate 13-metre high ceilings, is a company-owned store. Dymocks has eight company-owned stores, with 42 run under franchise agreements.

Dymocks competes against a range of players including traditional bricks-and-mortar independent booksellers such as Readings in Melbourne and Gleebooks in Sydney, and online giants such as Booktopia and Amazon.

Booktopia is a pure-play book retailer which listed on the ASX in a $43 million December 2020 initial public offering, but which has experienced a big decline in its share price over the past eight months. Booktopia was trading at $2.99 in late August last year, but has slipped to 70¢.

Booktopia shares were issued at $2.30 as part of the IPO and finished their first day of trading at $2.60, valuing the company at $357 million.

Booktopia had tried to raise $40 million through an IPO in 2016 but was forced to pull the plug because investors were spooked by the imminent arrival of Amazon and its book business, The Book Depository, into the $2.5 billion Australian book market.

Mr Newman said the new store contained 10 pieces of theatre furniture which had been discovered in the basement of the Regent Theatre. The theatre opened in 1928 and closed in 2004.

South Africa’s Woolworths Holdings has held discussions with investment banks as it considers selling David Jones, the up-­market Australian department store it purchased eight years ago.

A sale would finally end an investment odyssey that has cost Woolworths billions of dollars in writedowns, seen the company churn through five CEOs, and created an ongoing headache for management in South Africa.

Woolworths, listed on the Johannesburg Stock Exchange and not linked to the Australian supermarket chain, has already spoken to a number of banks as it looks for a buyer for David Jones to rid itself of its disappointing, sources said. It paid $2.1bn for the Australian retailer in 2014.

There has been speculation in Australian and South African investment markets that the Woolworths board has finally pulled the trigger on the sale of the 184-year-old department store.

On Monday, a Woolworths spokesman told The Australian that it did not comment on media or market speculation. “If there were any developments that warranted communication to the market, it would be done as and when required,” he said.

But insiders at David Jones headquarters in Melbourne and at Woolworths Holdings in South Africa tell a different story, with the final details of a number of sale options now being openly discussed with external advisers and bankers.

Woolworths is considering sale now that the company has returned to profit, its properties have been sold and most of its debt has been paid off.

The move comes as Australia emerges from the worst of the Covid-19 pandemic, which left many of the high-end retailer’s stores closed for months.

The end of lockdowns and restrictions is creating sales and profit momentum.

A succession of investment and merchant banks have been sounded out for the sale.

It is believed that Woolworths is highly unlikely to get close to the $2.1bn purchase price it paid in 2014 when it launched its takeover bid for the then ASX-listed David Jones.

The financial health of David Jones has improved considerably in the last few years.

It recently broke a three-year streak of losses to post its first bottom line net profit since 2018, lifted out of the red by property sales, lease benefits and an end to a horror run of impairments that grew to almost $1bn.

The addition of more than $70m in JobKeeper and other government wage subsidy programs helped David Jones return to profitability as its operations were shaken by prolonged lockdowns across Sydney and Melbourne.

The department store’s accounts lodged on the Johannesburg Stock Exchange in late 2021 showed adjusted earnings for 2021 of $84m.

Woolworths – which also owns the Country Road Group, Trenery, Witchery, Mimco and Politix – has pushed through restructures and cost cutting in the last 18 months.

Operationally David Jones has proved a costly headache and distraction for Woolworths – both for the former CEO who launched the takeover, Ian Moir, and his replacement, Roy Bagattini, who was appointed CEO in early 2020.

There has been considerable churn of senior executives and management at David Jones since Woolworths Holdings bought the business eight years ago.

The retailer has had five chief executives in six years.

To get its house in order Woolworths Holdings has pushed through a spate of activity, including property sales, led by the sale of the David Jones Elizabeth St Sydney CBD building for $510m, which produces a gain of $19.02m, and the sale of a building in Bourke St in the Melbourne CBD for $121m, with a gain on the sale of $23.76m.

The fast pace of the turnaround was driven by key operational initiatives, including the removal of tens of millions of dollars of costs, shutting down most of its loss-making food halls, exiting its disastrous BP food alliance and cutting floor space by as much as 7 per cent.

While sales at David Jones fell sharply for first six months of the financial year, they rose by 3.2 per cent in the six weeks to December 31.

Online sales, the company said, rose 44.2 per cent over the six-month period and contributed 28.1 per cent of the total.

Equities analysts had warned of a string of potential unfavourable investment updates for the retail sector as companies begin reporting first-half results.

But poor bricks-and-mortar sales are being balanced by a rise in online shopping at some of the country’s largest retailers.

JB Hi-Fi, which reported its first-half sales in January, recorded a 62.6 per cent increase in online sales – now making up 22.7 per cent of the total.

That result led Citi analysts to upgrade expectations for its rival Harvey Norman. They now expect earnings to increase by 9 per cent for the financial year. Harvey Norman is benefiting from a boom in home renovation.