Gibbons Company optimistic about ‘challenging’ 2023
Heading into the softer months, high manufacturing and shipping costs together with untimely arrivals, will continue to plague one of the island’s flagship retailers.
Depressed tourism numbers will further reduce the influx of foreign capital, and place limits on community resources for retail spending.
But Gibbons Company bosses remain upbeat and optimistic about the coming year’s prospects, despite the headwinds affecting the island’s retail sector.
Tony Thompson, Gibbons chief executive officer, concedes 2023 is going to be “a challenging year”.
But he added: “We are optimistic. We have exciting plans for 2023, both internally with staffing and with our stores, as well.
“We will continue to diversify our product offering and our vendor assortments, and we will continue to bring in internationally known brands that we know our customers love.
“Our website is doing quite well and we will keep all that and we’ll add some exciting services on the web that we are going to roll out in 2023.”
Mr Thompson was speaking after the August Retail Sales Index figures showed that the volume of sales for apparel stores grew 0.7 per cent compared to August 2021, while the value of apparel store sales increased by 3.2 per cent year over year.
However, the volume of sales for this sector was still 19.2 per cent behind the pre-pandemic levels in August 2019.
Mr Thompson said: “We actually fared better than average in August – we have been doing better than average for our sector, all year.
“It is still very challenging for us – we are still facing supply chain issues, getting orders and products late and out of season. We have to make decisions whether we keep orders or not, based on the timing of receipt.”
He said the cost of producing goods has increased, while the cost of transporting those goods to the island has risen “dramatically”.
Mr Thompson said: “Not only are the goods arriving late, they cost more to get here. That is a very difficult combination to navigate.”
He said container charges out of China have dropped by almost 60 per cent, but before doing so they had increased by almost 200 per cent. “They are still not at pre-pandemic prices.”
He added that the dramatic increase in the cost of living on-island this year has prompted Gibbons to increase staff salaries to offset those rising costs.
In addition, he said: “Every consumable has increased. The cost of doing business is affected by electricity, it is affected by rent.”
The current retail landscape?
Mr Thompson described it as: “Up and down. A roller coaster. Some days are extremely strong and some days are very weak. A lot of the good sales days are driven by promotion.”
He said that the period from Black Friday, which traditionally marks the beginning of the holiday shopping season, through December 24 is “extremely important”.
But he added: “Black Friday is no longer just the Friday, it’s actually the week and flows to Cyber Monday. Over the years, the days of Black Friday have extended more and more.”
In November, Gibbons had its ‘prime deals’ promotion, sending a flyer to every mailbox in Bermuda.
The Gibbons CEO said: “We started the promotion early in November, and it culminated in Black Friday and Cyber Monday.
“You can’t depend on one or two days as you have in the past – you need the whole month to be strong.”