A magnificent opera house, adorable kangaroos, legendary beaches and a tough cricket team: All these clearly give a cue about a country that has a long list of admirers, the world over.
Australia has earned an august reputation not only for its natural beauty and spot-on attitude, but also has emerged as a viable business destination. According to Australian National Retailers Association (ANRA), Australia's retail sector contributes approximately four per cent to the national economy and provides 1.2 million jobs. The textile and clothing industry of the country is the cynosure of all eyes. With growing investment opportunities in Australia's apparel retail sector, many international brands have flocked to Australian shores.
Yet, all is not seemingly well for this sector. According to Lauren Magner, IBISWorld industry analyst, "Prices have been driven lower by fierce competition and the high Australian dollar that prevailed over much of the past five years." Consequently, revenue growth has weakened amid a falling currency. But, in spite of the drab backdrop, Australian apparel retail still manages to look in good shape, riding on the back of consumers spending reasonable time on online apparel retail sites.
The Oz apparel story
Australia's apparel retail industry has come across umpteen challenges in the past few years. One of the major downsides is that clothing retail in Australia does not have widespread reach. The industry is fragmented and there are several small and independent operators, which has left significant percentage of businesses (approximately 43.3 per cent) to be operated by owners. According to an updated market research report by IBISWorld, an estimated 44.4 per cent retailers generate revenue between AU$ 200,000 and AU$ 2.0 million per annum, while a small section -- ie 5.9 per cent -- earn AU$ 2 million or more.
Economic slowdown has also hit the pace of customer spending and this cautious customer base has upset the industry's revenue. Also, with the Australian dollar sliding in value in recent times, rising prices of apparel are denting consumer pockets. Rising import prices of apparel have left retailers with little choice. Controlling apparel prices would mean a compromise with the quality and not many are willing to do so.
Rising apparel prices continue to cause concern, as apparel and clothing accessory imports to Australia have increased over the years. According to the Australian Bureau of Statistics, in October 2014, apparel imports stood at AU$ 646 million in comparison to AU$ 644 million in September 2014. In January 2014, Australia's apparel imports touched an all-time high of AU$ 765 million.
The apparel export scene is not very encouraging for Australia, either. There has been a significant drop in exports of apparel and clothing accessories. The Australian Bureau of Statistics reported that export of apparel and clothing accessories decreased to AU$ 21 million in September 2014 from AU$ 24 million in August 2014. Export of apparel fabrics has not altered noticeably either, staying put at AU$ 6 million in 2014.