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Superdry outlines expansion plans, challenges

Off the back of its recent bricks-and-mortar entry into New Zealand, streetwear brand Superdry is now set to expand across Sydney and Melbourne in August and September.

Over the next two months, Superdry will be opening stores at The Glen Shopping Centre and Essendon in Victoria and Homebush DFO in Sydney, in addition to its next store in New Zealand in Queenstown.

Superdry’s Auckland store opened in April this year and according to general brand manager at Superdry, Antony Hampson, the business is already achieving double digit sales growth versus its target.

“We’ve always had a good wholesale distribution in New Zealand, so we knew there was an appetite for the brand and it was the right time,” Hampson told Inside Retail

“It was important for us to present New Zealand with our full concept and all our product lines in one store. The response has been fantastic, people have really taken to the monobrand concept and appreciated the new silhouette and styles we’re offering.” 

In addition to the new Auckland store, Superdry also localised the New Zealand e-commerce site in April, which was previously operated through the UK. Now that the site runs from Australia and the distribution centre is based in Melbourne, New Zealand customers can enjoy speedier delivery and a more consistent customer experience.

“We’ve been able to open up a significant amount of our stock across all our network to our customer base. The distribution centre is in Melbourne, but we offer a ship-from-store functionality, which is important from a stock efficiency perspective,” explained Hampson. 

“We’re able to showcase stock in the distribution centre, as well as stock that may no longer be there but is available in stores, even fragmented stock, which they can purchase it online. That accounts for 30 per cent of our transactions.”

Challenges ahead

However, in other areas of the business, Superdry has faced some issues, notably the delay of the release of its annual results to July 10. Earlier in the year, founder Julian Dunkerton also warned that the gross profit of the entire year would be lower than current market expectations, due to changes in management and weaknesses in its on- and offline channels.

“We’re a separate entity in Australia and we’re fairly isolated from the rest of the world. We’ve built a strong business in the last 10 years where we’ve grown substantially, but the investments have been smart so we have haven’t overcapitalised. We still see opportunities to grow,” Hampson explained.

“I think a lot of the challenges that the brand has faced particularly in the UK have been driven from the top in terms of a conflict of strategic direction. That’s seen the founder [Dunkerton] voted back onto the board, which will straight away provide more clarity and understanding of what the direction is moving forward.” 

Hampson also pointed to the fact that given Superdry traditionally makes most of its sales from winter products, the brand has also been impacted by the warmer weather, like many other brands in the UK market. 

A focus on the customer

In the next financial year, Superdry is planning to continue growing its e-commerce channel. According to Hampson, the brand has invested in new software to better communicate and segment its customer base and its CRM capability is much more advanced than it was 12-18 months ago.

“That will allow us to understand our customers’ shopping habits in more detail and target customers more relevantly which will help to increase the purchase frequency in our database, which is an important factor amongst the doom and gloom around retail,” he said. “You have to continue to engage and grow your customer base and offer different products they wouldn’t have purchased into before.”

Over the next year, the brand’s in-store merchandising will also evolve into a more clean, streamlined and contemporary experience for customers, Hampson added. However, given Superdry’s shift in recent years towards becoming more of a lifestyle brand, product options will always be a priority in-store.

“Superdry was founded based on three key product categories – fleece, jackets and t-shirts. And although they will always remain the core centre of our narrative and we’ll continue to innovate and evolve across the categories, we also play in denim, shorts, shirting, accessories and footwear. So it’s important that from a customer perspective, we’re showcasing all of those additional product lines…to give customers an opportunity to buy into product they may not have otherwise and give them another reason to shop with Superdry.”

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