Retail Apparel Group-owner The Foschini Group has lauded the Australian retail market and indicated it is gearing up for further expansion throughout Australia and New Zealand.
The South African retail group, which owns local brands such as yd., Connor, Tarocash, Johnny Bigg, and Rockwear, said topline growth in Australia is in the double-digit, and it’s planning to introduce more of its brands to the region – namely jewelry brand American Swiss.
TFG chief executive Anthony Thunström told a media roundtable the company sees significant opportunity in the Australian and New Zealand market.
“Australia has not been in a recession since 1990 – it is almost the polar opposite to SA with unemployment also at record lows,” Thunström said.
“Retail is not by any means easy there with the high costs around rentals and other operational costs, so there is little margin for error to get it right or wrong.”
While David Jones-owner Woolworths Holdings has struggled in the Australian market, having recently booked a $437.4 million impairment against the department store due to economic headwinds, The Foschini Group has found success in multiple markets by focusing on delivering a more niche offering.
Thunström said the business doesn’t dictate from afar what will be successful in the Australian market but instead purchased the business with strong leadership teams in order to allow them to steer the local offering.
“If we went to Australia or the UK and tried to run the business ourselves, we would end up in tears,” Thunström said.
“There are too many local nuances.”
According to Business Report, the retail group said it will inject R500 million ($48 million) into technology in order to get ahead of the changing retail market – having witnessed its online sales increase 57.2 percent over the year to March.