The Reject Shop Damaged By CBD Exodus And Shipping Costs
Bargain basement store The Reject Shop is suffering due to the lack of foot traffic in Australia’s CBDs and metro shopping centres, as well as the increased cost and instability of international shipping.
47 stores in CBD locations and metro shopping centres had seen an average 12 per cent slide in sales for the 48 weeks ended May 30, compared with the figures from the same period two years prior. 2018/19 figures were deemed more representative than last year’s COVID-infected numbers.
Conversely, the 290 Reject Shops outside of cities had enjoyed a 0.9 per cent rise in sales for the same period.
As The Reject Shop imported the majority of its products from Asia, supply chain costs have risen, and the company has also had to invest in extra inventory in case of shipping delays and disruptions.
The Reject Shop revealed on Friday they expect EBITDA earnings for FY21 to be between $8-10 million, with total sales revenue in the ballpark of $776-778 million.