Zara Australia to maintain prices as Australian dollar falls
In this article (4)
Zara Australia has turned up the heat on domestic retailers by vowing to maintain prices despite a 17 percent fall in the dollar in the past five months.
Zara’s plan to keep Australian prices on hold will limit the ability of domestic suppliers and retailers to raise prices across the board to recoup the cost of importing stock from countries such as China, India, Vietnam and Bangladesh.
As reported in The Australian Financial Review last week, suppliers have warned retailers that prices for fashion clothing, underwear and basic apparel will rise significantly in the second half of calendar 2015 as currency hedges roll off and new season stock comes into stores.
Questions & Answers
Q.What is the primary reason Zara Australia is able to maintain its prices?
What is the primary reason Zara Australia is able to maintain its prices?
The article states that Zara Australia has vowed to keep its prices on hold despite a 17 percent fall in the Australian dollar over the last five months. This decision limits the ability of other retailers to raise their prices.
Q.How will Zara's pricing strategy affect other Australian retailers?
How will Zara's pricing strategy affect other Australian retailers?
Zara's decision to maintain prices will make it difficult for domestic suppliers and retailers to raise their own prices. This impacts their ability to recoup the increased cost of importing stock from countries like China and India.
Q.When are price increases expected from other fashion retailers in Australia?
When are price increases expected from other fashion retailers in Australia?
Suppliers have warned retailers that prices for fashion clothing, underwear, and basic apparel are expected to rise significantly in the second half of calendar year 2015. This is due to currency hedges expiring and new stock arriving.
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