Zara, H&M and Uniqlo to keep steamrolling locals, says Macquarie

International fast fashionFashion is a popular style or practice, especially in clothing, footwear, accessories, makeup, body piercing, or furniture. Fashion is a distinctive and often habitual trend in the style in which a person dresses. It is the prevailing styles in behaviour and the newest creations of textile designers. giants Zara, H&M and Uniqlo will almost double their share of the local apparel market next year and continue taking established retailers’ customers, analysts say.
The three global retailers had combined sales in Australia of about $460 million last financial year, according to research released by Macquarie on Monday.
Together they accounted for about 1.1 per cent of total spending on clothes, accessories and at department stores, and Macquarie predicts that will rise to 1.7-2 next financial year.

However, that growth has been tempered, as some of the retailers’ new stores in suburban locations underperformed, analysts Rob Freeman and Paul Checchin wrote.

Zara, the first of the three to hit Australian shores, was turning over $42.8 million a store when it opened in 2012, but that more than halved to $17.3 million a store in 2015; and H&M’s sales per store fell 61 per cent and Uniqlo’s fell 63 per cent since they opened in 2014.
“While Zara, H&M and Uniqlo’s sales have deteriorated from initially elevated levels, we continue to expect them to take market share as they roll out additional stores and that this will not deter the continuing trend of offshore retailers entering the Australian market,” the research says.

Zara has 13 Australian stores and expects to open 20; H&M has seven and Uniqlo has 10, and both want to hit 30 stores.
The biggest losers from that will be department stores such as Myer and discount department stores like the Wesfarmers-owned Kmart and Target and Woolworths’ Big W, which will be “highly exposed” as international retailers grow their footprint.
“Given the price points of the international retailers, many of their products place them in direct competition with the [discount department stores],” the report says.
“The DDS sector has been under pressure over a number of years with sales remaining flat or declining.”

Myer and David Jones have seen their combined market share fall from about 15 per cent to about 13 per cent during the past eight years, Macquarie said, while Myer continues to reduce its storeA retail store where merchandise is sold, usually a product, usually on a retail basis, and where wares are often kept. numbers nationwide.
H&M was the best performing of the three retailers, recording the highest sales per store and the largest gross margin.

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