We asked three retailers, who rely heavily on international tourists, what the reopening means for them and how their business is prepared to deal with this uncertain landscape.
Costa Kouros, managing director, AWPL
“[As a result of the pandemic], we went from over 700 employees down to just over 200 employees. We’ve achieved just over 10 per cent of our 2019 sales since then due to the impacts of Covid.
“We’re not purely reliant on international air travel, so in one way, we were a little bit fortunate for part of the Covid-impacted period because we do also have stores in the domestic terminal, but what I didn’t factor in was the lunacy of our state premiers and the impact they we’re going to have. We’ve not only copped it because of international borders, the state borders compounded it.
“This is a privately-owned business. There’s one shareholder. The easiest thing for me to do would have been to put it into administration and walk away.
“The things that saved the business are my bank, which has been incredibly supportive, my staff, my suppliers, and, believe it or not, the airports. If the airports didn’t support me in the way they have, I would have lost the lot. One hundred per cent of our income comes out of airports, and 100 per cent of our losses are as a result of being in airports at the moment.
“We’re going to take years to recover. They can open up the borders, they can get international travel happening, but, honestly, there is a long way to go before confidence returns to the airport sector and travel retail sector.
“I am an eternal optimist, and this is an incredible industry to be part of, but I still think we’ve got a couple of years of relative uncertainty.
“[Regarding vaccination mandates], we will do whatever we are legally required to do. And we will always be incredibly respectful of our staff.”
Keong Chan, executive chairman, Aumake
“Our primary customers, international students and tourists, are not in Australia or New Zealand to promote local brands and to purchase products for family and friends back in their countries of origin. But they will be returning which is great news for our business.
“Aumake has transitioned from [being] a primarily physical store business to an online business. We have invested and developed an influencer-led social e-commerce marketplace that will now support our customers, and [we have the] ability to access and promote new brands to [our influencers’] social network.
“With borders reopening, we are able to operate with fewer physical stores and instead operate as primarily an online business supported by a few physical stores. Contrast this to our pre-Covid-19 business model, as a retailer, where we aimed to sell products at a higher price to our purchase price to generate sales and gross profit. These are fundamental differences in relation to purpose, scale and volume.
“Aumake now has the opportunity to significantly increase its market share given that many of our competitors have withdrawn from the market during Covid-19.
“We have [Covid-safe] measures in place like most businesses, however, we have not made a decision yet regarding vaccination and will be closely observing government guidelines.”
Athan Didaskalou, founder and chief strategy officer, July
“The closure of both domestic and international borders has affected us greatly. We lost 95 per cent of revenue. It was quite a big drop for us and we didn’t know whether we were going to survive. We’ve had some great supporters in terms of our previous customers and our investors who have stood by us through this time. Our staff maintained a happy face and we continued creating new products.
“We’re really excited about the reopening of international borders. I think Australia’s been lagging behind on that front. Since launching in the US, we’ve seen vaccinated US nationals travelling all over the world, all over America. We’ve seen parallel worlds, what post-Covid looks like, and it looks great. People are happy and confident to travel again, and they’re doing it at least 40 or 50 per cent more than they were pre-pandemic, as if to catch up [on lost time]. This concept of revenge travel is really interesting; people want to go on that trip they’ve always wanted to and spend the money they’ve saved over the last two years to treat themselves.
“We expanded into the US remotely, we’re developing products remotely in China. We want to visit those places, make sure we have the right people on the ground, touch the materials … We’re also moving some of our manufacturing to Indonesia, so we want to get set up there.
“The US market has been so significant. Maybe that will change once international borders reopen in Australia, but we’re just seeing such a significant demand for our product over there. We’re so excited by the prospect of it. So, we want to be there, set up an office, set up a warehouse, get it all done. We’ll start hunting for locations [for a physical store]. We believe in [physical] retail as a really good acquisition tool for customers to come across the brand and experience new things.
“We support the team and their choice [on vaccination]; there’s not much physical contact, we’re not a service business … When you work for a travel accessories business, you’re open to flying, and if you can’t fly without a vaccination, then I’m sure team members will get vaccinated in order to do so.”