In another blow to shoppers across Australia, The Reject Shop will close seven of its stores in the next month due to falling profits.
The company’s CEO Ross Sudano will also leave the struggling company, which has predicted a $2 million loss this year.
It’s believed that declining sales, higher operational costs and a challenging retail market has lead to the store closures.
'The reduced earnings guidance reflects a tough trading environment in the retail sector which has continued to be impacted by low consumer confidence, flat wages, increases in the cost of living and a rapidly falling housing sector,' the company said in a statement.
'Gross margins have fallen as the expected benefits from sales and merchandise related initiatives have not landed with consumers during the half.'
As a result, seven stores will close by the end of June. The locations of the affected stores have not been disclosed yet, but company says they were unable to negotiate ‘acceptable’ rents with the stores that are closing.
In recent months The Reject Shop has tried to revive declining sales by launching a new homewares collection, in competition with Kmart, Target, Aldi and most recently Big W.
The Reject Shop closures comes after Big W anounced earlier this year that they’d be closing 30 stores - while Best & Less also closed the doors on one of their most-loved stores.