Reject Shop says coronavirus panic buying a big boost to sales
Panic buying sweeping Australia helps retailer to six-fold increase compared to last year.
The Reject Shop has become the first national retailer to say the panic buying sweeping Australia in the wake of the coronavirus outbreak has put a rocket under its sales.
Reject Shop’s same store sales have risen more than sixfold in recent weeks compared the same period in 2019.
Others retailers, especially supermarkets led by Woolworths and Coles, are also expected to have recorded an unprecedented lift in sales as their shelves are stripped by anxious shoppers who are hoarding everything from toilet paper to pretzels.
Reject Shop is in the midst of a capital raising and updated its latest sales performance for investors on Monday. It also said product from China was arriving.
“In the last three weeks, The Reject Shop has experienced a material increase in sales driven by customer concerns around coronavirus,” the company said.
Like-for-like sales for the first eleven weeks of the second half of fiscal 2020 were up 5.7 per cent, the company said. As announced on February 27, comparable sales for the first eight weeks of the second half of 2020 were up 2.3 per cent.
Comparable sales for the three week period between 24 February to 15 March 2020 were up 15.1 per cent. This was driven by strong category performances in cleaning, groceries, toiletries and pet care, Reject Shop announced.
“The Reject Shop recognises the uncertain duration of the elevated sales activity pertaining to coronavirus and cautions against assuming that these elevated sales will continue through to the end of fiscal 2020,” the company said in a statement.
“The Reject Shop confirms that stock is starting to be received from the company’s China-based suppliers.
Chief executive Andre Reich said while a significant portion of the sales growth over the last three weeks had been driven by customer concerns around coronavirus, he was pleased with the underlying comparable sales trajectory as well as the initial customer response to the improved product range.
The Reject Shop is conducting a capital raising for $25 million.
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