Kogan: Australia begging for diversification

Ruslan Kogan, pictured right.

Ruslan KoganPureplay retailer Kogan.com’s founder says “significant behavioural shifts” are reshaping Aussie retail.

After recording revenue growth of 36.2 per cent, gross margin growth of 18.4 per cent and

EBITDA growth against prior year’s pro-forma EBITDA of 58.3 per cent at the e-tailers AGM. Ruslan Kogan said online retail is still under-represented in Australia compared to other major developed economies.

“There’s no doubt that the way people buy goods and services in Australia has undergone significant change in the past decade,” he said.

“It’s a wave of change that continues with great pace and we are proud to have played a key role in it. Saying that, we operate in a dynamic market and we expect that wave of change to accelerate as commerce in Australia undergoes structural change.”

Online retail represents about 7.5 per cent of the total Aussie retail market, in comparison to economies with a large marketplace player (such as an Amazon or an Alibaba) online retail penetration is closer to 20 per cent.

“While Amazon is already a major force in Australia (it’s a top 25 site) the launch of a local presence will undoubtedly bring more shoppers online.

“With traditional channels facing continued consolidation, the path to market in Australia is begging for diversification. We expect the evolution of the local retail market to drive some significant behavioural shifts – causing customers to rethink how they buy and suppliers to rethink how they distribute their inventory.

“For Kogan.com, this represents an opportunity to drive incremental sales through additional platforms and channels – just as we benefit from eBay and TradeMe as a platform for Kogan’s suite of exclusive brands.”

“With a brand that has built a reputation for price leadership through digital efficiency, Kogan.com is well placed to continue to grow market share.”

In 2017 Kogan.com paid out 7.7 cents per share or $7.2 million in dividends. Total shareholder returns for our IPO investors were 115.9 per cent at market close yesterday.

“These returns have been facilitated by the success of our new verticals, brand growth, the e-commerce infrastructure we have built over the last 11 years and the strong operating momentum in our business,” said Kogan.

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