Page 17 - Ragtrader Magazine April 2020

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NEWS FEATURE
CORONAVIRUS
APRIL 2020 17
“We will definitely air freight shoes once the factories come back just to make sure that we’ve got the styles that we had in our campaign that were going to be late. We’ll air freight quantities of those,” he says.
Mosaic Brands CEO Scott Evans says the business will also consider air freight- ing stock to meet demand in Australia.
“We’ve got a bunch of priority items that we will air freight if we need to but having said that you can’t air freight items at the moment anyway.
“The stock that was supposed to arrive early February was delayed anywhere between two and three weeks due to Chinese New Year being extended and the quarantine on shipment here.
“In most factories everything that we would receive in February and March was made before Chinese New Year so those garments are made and ready to ship.
“Obviously February is now done so those garments are just going experience
In the wake
of the emergency
and increased enqui-
ries, insolvency service
Jirsch Sutherland has set up a retailer hotline to field concerns about coronavirus.
Jirsch Sutherland national managing partner Bradd Morelli says key concerns are around supply chains and sales.
“Immediate issues are that it’s hitting sales and revenues and there’s starting to be concerns. This is the feedback we’re getting from the people we’re talking to around sup- ply chain and reliability and disruption.
“In the long term, in my view, it is largely unknown as we don’t know the economic impact that the virus is going to have and the longer it goes it’s going to take more time for revenue and supply chain issues
unfold as time progresses, but we have a real solid sourcing policy that we will stick to.
“But of course, we will adjust that accordingly but we’re not not going to make in China moving forward,” he says.
For Tony Bianco, the plan is to remain positive and diligent about stock decisions Bianco says.
a delay in shipping whether that be two or three weeks, we will get them,” he says.
Despite the costs associated with air freighting, Evans says the bigger concern for the Group is garments not yet made and how long these might take to be produced.
“The bigger piece which is what we’re nervous about – and I say nervous because we just don’t know so we don’t know whether to be nervous or not – is that the product that is due for April and May, which is important for us because that’s Mother’s Day and a lot of it is obviously winter facing product, those are the collec- tions that aren’t yet made.
“They were not made before Chinese New Year. The impact there is not just shipping the impact is, ‘how quickly will the factories, the mills and everybody get back to normal and start to produce?’”
Bianco adds that these delays also have a wider knock-on effect to wholesale business. “We’ve got our wholesale accounts who
depend on us for deliveries.
“I’m just talking about us: we deal with
The Iconic, David Jones, Myer. They depend on us for deliveries and deliveries are going to be late.
“You can’t not have shoes,” he says.
to normalise,” he says.
In terms of what retailers can do now
to mitigate the impacts, Morelli says that Australian businesses should pay close attention to elements that they can control.
“Businesses should be proactive, they should be diligent around the costs that they can control, they should monitor the situation espe- cially around cashflow.
“Look for alternative suppliers if
they’re there. Look to online sales
– and that’s nothing new, people
have a desire to shop – consider what the broader impacts might be, we suggest that businesses talk to their financial advisor, look at fixed costs and in the event that they need to rationalise costs, don’t be slow to make those decisions,” he says.
For Mosaic Brands, the business is con- sidering its sourcing policy and will fur- ther assess it as time goes on Evans says.
“We have a real solid sourcing policy and we’re always looking at where we should and should not manufacture.
“The coronavirus has very much come from left of field; are we panicking and over- reacting? I don’t think so. I think we’re con- sidered about it and the true extent of it will
“We’re very lucky that we had plenty of winter boots delivered pre-CNY so we’re right until through to April.
“Our plans are so many plans – we’re trying to plan as much as we can. We’ve
Immediate issues are that it’s hitting sales and revenues and there’s starting to be concerns.
got a bit of production out of India, a bit out of Vietnam but this just highlights the risks of the business that we all do. Maybe you’ve got to spread your business a bit more in future.
“I’m thinking positive – if they get back, we’ll obviously have to be careful about the back orders of winter – repeats will be tighter.
“The positives hopefully will be that because there’s less stock in the market, hopefully less discounting, the big sales won’t be there because they can’t afford to clear too much stock because they’re wait- ing on more stock.
“A positive could also a drop of winter product in winter, so it’s seasonal,” he says. ■