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Two years until pre-quake profit margins recovered, says Kaikoura retailer

  • News
  • December 8, 2016
  • Caitlin Salter
Two years until pre-quake profit margins recovered, says Kaikoura retailer

Coastal Sports owner Dwayne Fussell says the online store has been a lifeline, but delivering goods takes some creative thinking.

"Freight has been interesting,” he says. “Anybody and everybody has taken parcels out if they're heading to Christchurch. We've had family meeting them at the other end to drop parcels off at the depot."

Coastal Sports has supplied Kaikoura locals and tourists with sports and adventure gear since it opened in 2003 as a franchise of R&R Sport. Since 2013, Coastal Sports has been operating as an independent retailer, after choosing to leave the franchise when The Warehouse Group acquired it, rather than shutting up shop in Kaikoura.

Traditionally, the online store has only been between 10 and 15 percent of monthly turnover, but with main access routes into Kaikoura cut off and tourist numbers down, the retailer is now aiming to grow the online business by 30 to 40 percent.

During the flurry of earthquakes on November 14, Fussell spent the night sitting on the peninsula thinking about his shop and what would be left of it in the morning.

Worried about the violence of the shakes and the age of most of Kaikoura's buildings, he assumed there would be nothing left. 

Thankfully, the store held up incredibly well. Fragile surfboards remained held in their racks by bungee cords and after a couple of hours of clean-up, Coastal Sports was open again.

Local customers have always been an integral part of the retailer's business, and Fussell says the residents have shown his shop loyalty and support in the last few weeks.

"Locals have shown us amazing support and gone out of their way to help us get through this as a business. Most are really trying to do all their Christmas shopping locally."

All retailers and businesses in Kaikoura are suffering a lot of financial stress at the moment. The summer season in the tourist hotspot is key for helping most retailers survive the quieter winter months, but Fussell says people are trying to remain positive and patient.

Coastal Sports relies on summer spending to fund stock purchases for the following season, so Fussell hopes the online presence will be enough to get them through.

"We'll get through this summer trading at 50 percent but to get through an even quieter winter and then fund next summer is taking some planning."

Fussell anticipates businesses operating as usual again by next summer, if access to Kaikoura is reinstated. But he predicts it could be as long as two years to start seeing profit margins return to pre-quake numbers again.

Coastal Sports have been growing the online element of the business for the last two and a half years, which puts them in a better position than other retailers who are now trying to replace lost foot traffic with new online stores.

"It won't replace the lost trade from tourism, but every bit helps," Fussell says.

Kaikoura retailers have been working together to come up with promotions to support each other in the wake of the earthquake. Former competitors have become allies and initiatives like Shop Kaikoura are helping businesses stay afloat.

Coastal Sports is currently running a pre-Christmas sale to drive traffic to the website and Fussell says it’s important to the company to stay on it’s own two feet.

The most important thing all New Zealanders can do to help Kaikoura is keep coming, Fussell says.

He hopes the changed landscape and risen seabed with attract more tourists in time.

"People need to check Kaikoura out once we're back up and running with roads and accommodation.

"The earthquake is a unique event with the coastline lifting out of the sea, it really is worth a look."

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