SMH: Retailers Hanging Tough but Smaller Brands at Risk

Image Credit: SMH / Joe Armao

Australia’s retail sector is expected to hold steady despite economic pressures, with affluent consumers continuing to spend on home maintenance and travel. However, smaller brands and retailers selling big-ticket items and apparel face growing challenges due to rising interest rates and cost-of-living pressures. “Any retail categories tied to large one-off purchases or luxury are often the first to be impacted by rises in interest rates,” says RetailOasis Director Trent Rigby, noting that brands like JB Hi-Fi, Harvey Norman, and Adairs are already experiencing slower sales. Analysts warn that mid-market fashion retailers and department stores could also struggle as discretionary spending declines. Smaller independent retailers are likely to be hit hardest, with Rigby cautioning that “in addition to decreased consumer confidence, reduced spend and slower overall growth – smaller retailers have increased difficulty in forecasting inventory demand and ability to service debt.” Read the full article here.