Mark Stirton: Warehouse Group CEO hopeful the retailer can grow following recent net loss

The Warehouse Group's chief executive is confident he can turn the retail giant around. 

It's reporting an annual net loss of $2.76 million dollars - a major improvement from last year's $54.2 million dollar loss.

Noel Leeming is performing the best, with revenue up 3.3 percent.

Chief executive Mark Stirton says they're moving away from a digital focus to give more attention to shoppers in-store. 

"Our urban areas are where we've got a lot more competition - we probably haven't invested enough in the store experience, and things like lighting and visual merchandising and the way we present our product."

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Episode Transcript

Speaker 1 (00:00):
Right.

Speaker 2 (00:00):
The Warehouse Group has had another tough year. It's been
reported all rather. It has reported a net loss of
two point eight million dollars for the year. Mark Sturton
is the chief executive of the Warehouse Group. Harmark you
that tough day for you guys.

Speaker 1 (00:13):
Yeah, it's a tough day. You know. The economy is
in a tough space as well, and we're feeling it
as a retailer in these conditions, and consumers are doing
a tough and yeah, we're proud that we were able
to keep our top line in the positive in this environment,
but unfortunately we had to reduce some of our prices

(00:33):
and be competitive with a lot more promotions and clearance,
which it hurts our gross margins and they're ultimately our
result at the bottom line, despite doing some really good
work on cost control.

Speaker 2 (00:44):
How much of what is going on with the Warehouse
is down to the economy and how much of it
is down to the Warehouse and its own problems.

Speaker 1 (00:52):
Yeah, I think that the economy is definitely weighing on
the consumer sentiment. I mean, we're still getting over all
the brand. We still get one point seven million people
come through our doors every week, which is incredible number
of visits for us as a brand. So we're definitely
getting the foot traffic and our conversions up across all
our brands, which is great. People are finding the things

(01:14):
that we that they want. Unfortunately, the basket sizes are
are not as big as what they need to be,
and that's also a function of the mix of the
products that people are buying. We're seeing a lot more
people buying too smaller AEMS ticket items, which you know,
you have to sell a lot more of those to
make up the dollars that you need in order to
get the top line moving, so and a lot of

(01:36):
those items come at lower margins. So's that's really the
story is that we've and that's across all three of
our brands. We've found that the mix of the products
that are being sold is actually also affecting our gross margin.

Speaker 2 (01:48):
How long have you been in the job now?

Speaker 1 (01:51):
Ours the group's CFO, and I came over in April
last year, so yeah, I've been in that role for
fifteen months and then I took over on the first
of August this see year.

Speaker 2 (02:00):
Okay, do you see a way to turn this around?

Speaker 1 (02:02):
Definitely? I think we've got incredible brands. I've actually I
can't believe that we've actually got that endowment of one
point seven million feet. I mean, you think about New
Zealand's a population of five point two million, and you've
got that amount of visitors coming through your stores every week.
It's owns our job to convert those feet into more
meaningful baskets. And you know, our stores under our old

(02:25):
strategy was more digitally focused, and we're going to get
more focused on our stores. We've got some incredible house
brands that have probably fallen by the wayside, and we're
going to amplify those. And so we're really going to
dig into our rural and regional roots, which we acceptionally
strong as a business in those towns and cities, and
then those are our urban areas where we've got a
lot more competition. We probably haven't invested enough in the

(02:47):
store experience and things like lighting and visual merchandising and
the way we present our products. And we're getting some
amazing traction in our beauty range, and you know, we've
seen there's a lot of green shoots around the business.
But we would be lovely if the economy also played ball,
and we really hopeful that the ocr cuts that hopefully
come up will help us on our journey.

Speaker 2 (03:10):
Yeah, best of luck with that, Mark, Thanks so much,
Mark sturs and chief executive of the Warehouse Group. For
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