Adairs to reopen stores after online boost

Home furnishings retailer Adairs will start reopening stores this week, after online sales surged 221pc during the lockdown.

Adairs will this week start reopening its stores.

Home furnishings retailer Adairs says its online sales have rocketed 221 per cent since its stores closed last month and Australians were told to stay home because of COVID-19.

Although total sales for the cushions, bedding and linen retailer are down 37 per cent from the same period last year, its online platform is doing a brisk trade. Its recently-purchased online retail chain Mocka posted online sales growth of 151 per cent.

Adairs said its stores will start reopening on May 7, with all stores expected to be open by the end of June while negotiations with landlords over rent continue.

On March 19, Adairs announced the withdrawal of its fiscal 2020 earnings guidance, and the cancellation of the first half interim dividend. On March 27, it announced that it would temporarily close its Australian stores for a period of 4-6 weeks.

All operations were also closed in New Zealand, to protect its staff and customers from coronavirus.

However both Adairs’ and Mocka’s Australian online operations have continued to trade throughout this period, bringing in new online customers.

In a trading update Adairs said online sales were up 221 per cent for the five weeks ending May 3.

Adairs online sales for the nine months to March 2020 represented approximately 20 per cent of the total sales of the Adairs business.

“The strength of our online platform and the 221 per cent growth in online we have seen since stores closed has resulted in Adairs sales for the last five weeks being down approximately 37 per cent compared to last year,’’ the company said.

“Pleasingly, around 30 per cent of this online growth has come from customers who were not members of Linen Lovers (loyalty program) or had not previously shopped online with Adairs.”

Shares in the retailer closed down 3.9 per cent at $1.47.

Adairs said it continues to have “constructive” discussions with the majority of its landlords over rent, with discussions focused on sharing the pain of store closures and rental obligations. Where the company had arrived at a mutually agreeable outcome, it would pay rent in line with that greement.

Adairs chief executive Mark Ronan said the company has responded decisively to the changing circumstances with a focus on the health and safety of team and customers together with the financial position of the business.

“Our staged store openings reflect our ‘safety first’ approach as we welcome back our team and customers into our stores. There is still a long way to go, however the actions and contributions made to date put us in a strong position to navigate this changing environment.”