Retailer rejects e-commerce

 

Reject shopAustralian discount chain, The Reject Shop, is staying clear of e-commerce or Click & Collect until “the numbers stack up” for its model.

The discount chain, which has 300 stores nationwide, has looked into the online trend but will stay away for now, says MD Chris Bryce.

“We’ve yet to be able to make the numbers stack up,” he says, citing the retailer’s low average basket size as a main reason for this.

The Reject Shop’s average basket price is around $10.50, with its main fare low ticket items, such as stationary, beauty, confectionary, or household items.

“Our product offer is generally built around things that people are buying in ones or two,” said Bryce to the Australian Financial Review.

The business has looked into Click & Collect, where customers buy online but pick up instore, several times in the last year.

The Reject Shop believes it would need to increase its average basket price by at least six fold to make the costs of online distribution viable.

The chain reported a 13.3 per cent rise in sales to $618 million in the last financial year, but its top line was hit as it reinvested profit into new stores.

The Reject Shop opened 41 new stores during the period, with it planning to add around this number again in the next 12 months.

Bryce said the chain was originally forecasted to hit 400 stores in Australia, but that it could potentially go up to 500 in the new retail climate.

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