Riding the retail rollercoaster

While recent times have been extraordinarily tough for New Zealand’s retailers, Dunedin’s Amy Chapman has been busy thinking outside the ‘bricks and mortar’ box to develop her fashion retail business.

The latest Westpac McDermott Miller Consumer Confidence Index has revealed that consumer confidence in New Zealand is at its highest in more than two years.

Retailers around the country are understandably hoping that this lift will translate into sales, but Retail NZ CEO Carolyn Young reports their members are saying it’s still tough to make sales and customers are generally spending less.

“Overall, retailers are expecting 2024 will be challenging, so we hope this increase in consumer confidence will see people willing to spend a little more when they go shopping.”

There’s no doubt that Kiwis everywhere have been living through tough financial times, with inflation impacting every aspect of their lives. It stands to reason that discretionary spending is a thing of the past.

New Zealand’s fashion retail sector has been one of the most affected by this reluctance to spend.

According to IBISWorld, there are 2,093 clothing retail businesses in New Zealand. It is a highly competitive sector, and survival requires both tenacity and smart thinking.

One fashion store that is demonstrating a remarkable ability to survive, and indeed thrive, in tough times is Chapman in Dunedin’s George Street.

Owner and mother-of-two Amy Chapman has been in the fashion industry from a young age – starting out as a full-time sales assistant when she was just 17.

Amy had worked for Mike Collins, the founder of Slick Willys until he passed away in 2004.

She purchased the store from Mike’s wife the following year and spent several years building the brand list and database before selling Slick Willys in late 2020.

“Before the store was sold we had two doors open,” she explains. “One in the original upstairs location and a second next door on the ground floor. The target customer for the downstairs space was more mature females who liked brands that were slightly more premium than the upstairs unisex space.

“I loved the brands and the vibe of the downstairs store and wasn’t ready to sell that. So, we decided to keep the space and rebrand as ‘Chapman’.”

Growth and roadblocks

After outgrowing that downstairs store, Chapman was moved to a much larger space across the other side of George Street. This came with four times the size and double the rent, but it was a necessary step in order to grow the business, recalls Amy.

“We had a really tough year leading up to the move as [what’s regarded as] Dunedin’s ‘main street’ has been undergoing major upgrades. Our whole block has been closed to any traffic since March 2023 and won’t reopen until the end of April. This has had a huge negative impact on our business.

“In my 20-plus years in retail this is by far the hardest time I have encountered. Locals are avoiding visiting the area.”

With not only the main street closed, the majority of adjoining streets have also been closed, and it has been almost impossible to get a car park in the city, she says.

Online to the rescue

Amy had to launch a new website and database after selling Slick Willys and describes her online store and database as a bit of a slow process in terms of establishing the Chapman brand.

“However, over the past 12 months we have really ramped up the work as our online store is having to carry us through the roadworks period.”

She says the majority of her marketing spend is with Google and SEO (search engine optimisation).

“Chapman is, by far, not the perfect online store,” she admits, “but it is a work in progress.”

She says the key to a successful online business is to keep it simple. “You want your site to be easily found by potential customers, so they can find what they are looking for and make that purchase.”

Succeeding in tough times

Amy believes the retail business climate is tough for everyone right now. She also believes that customer experience is everything.

“We do our best to make everyone’s experience with Chapman, either in-store or online, a great one. Where possible the answer is always ‘yes’, and every person is important.

“The other thing that’s important is looking after your team,” she says. “I have always had amazing staff and always will have amazing staff. Because I genuinely respect and care for them. “Without a great team you really have nothing.”

Lessons and plans

Owning a retail store in 2024 comes with a number of big lessons. “The most important thing I’ve learnt is to know every part of how your business works,” Amy says. “Also, realise that sometimes business is hard, and at those times you must stay positive and work even harder to get through it.”

Looking ahead she says the primary focus for Chapman will be the online store. “There are things about it I do not love, so these will be worked on.

“I’ll also endeavour to not overspend my budget and learn to sometimes say ‘no’.”

Online retailing: getting it right

Mark Presnell, MD of e-commerce integration specialist Convergence, says Kiwi retailers must embrace online retail and treat it like the future, without compromising on relationship-driven personal customer service. His advice is:

• Embrace Technology: While transitioning to a quality online presence requires time and investment, neglecting it altogether is a recipe for failure. Retailers who are technically challenged should turn to Government programmes and consultants who can help bridge the skills gap and equip retailers with the tools they need to succeed online.
• Omnichannel Integration: Treating online and in-store operations as separate entities creates unnecessary workload and inconsistency. Integrating these channels can streamline operations and offer convenient options like click-and-collect, further enhancing the customer experience.
• Community and Collaboration: Networking with other online retailers provides valuable support and learning opportunities. Sharing best practices and collaborating on solutions can empower even the smallest businesses to compete effectively.

“The future of retail belongs to those who adapt and innovate,” Presnell says.