Coming off a strong rebound from Covid in 2022, the founder of luggage retailer July, Richard Li, sees a big year ahead due to surges in travel. We recently spoke with Li about the biggest opportunities and challenges facing the business now. Inside Retail: What was July’s performance like in 2022? Richard Li: 2022 was an incredible year for us. Following two years of lockdowns and travel restrictions, it’s been so exciting to see how much we’ve grown in the past 12 months. During Co
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ing Covid-19, we lost over 95 per cent of our revenue. Since then, we’ve grown enormously, over 640 per cent in FY22, and are now doing more than 10 times the pre-Covid revenue. In 2022, we launched nine new products, opened additional retail stores across Melbourne and our first in Sydney, held an in-person press event in the US and achieved our best day of sales ever in November. IR: Looking back, are there any high and low points that stand out to you? RL: After the past two years with Covid, it’s hard to see anything from 2022 as a low point – it was a fantastic year. The resurgence of travel has driven our growth to unprecedented levels and we’re reaching new heights every day. We’ve grown the team, opened new stores and repeatedly smashed sales targets. The problems we have are great, as they come from growth, but they’re still problems. Notably, we’ve had to expand the team to meet the demands of our growing business, and that’s been a challenge in the current market. In our retail stores, we’ve even been flying Sydney team members down here to Melbourne for retail shifts. We’re proud to have an even bigger team now that is agile, dynamic and solutions focused. We can’t wait to see what this new cohort at July achieves. A highlight from 2022 was our partnership with the Olympics and Commonwealth Games. It’s been a huge achievement and an honour for our business to provide July cases to Aussie athletes representing our country across the globe. We’re just four years old, so this partnership felt like a coming-of-age moment for us. IR: How did you adapt the business to get through the pandemic? RL: Covid was incredibly hard for us. In early 2020, we had just opened our first retail store at QV in Melbourne and had plans to open more, and we had countless products coming down the pipeline. We were feeling so good about the year ahead, until March, when it all came crashing down. The last few years have truly tested our resilience, but we used the down time to focus on product development, as our mission at July has always been to create great products. In July 2021, we launched in the US, as they were back travelling so much faster than us here in Australia. The market is huge over there but we made an impact, and quickly we sold 10 times more cases than we’d predicted. That growth has only accelerated over the past year and it supported us back at home whilst we dealt with ongoing travel restrictions in the latter half of 2021. IR: What is your approach to e-commerce and bricks-and-mortar, and where do you see in-store shopping going in 2023? RL: We launched as an online-only business, but our retail stores have played a key role in our growth. We’ve found that customers love being able to interact with the products, feel the multi-stop handle and the SilentMove wheels, and meet our amazing team. We opened our first store outside of Victoria in September 2022 – our new space at The Galeries. We have more website visitors from Sydney than any other city in the world, so it was only natural that we would open a retail store there. Since then, we have seen hundreds of new and returning customers come through the doors and have been thrilled to bring them the July experience in person. We’ve certainly seen an increase in the number of customers shopping in person, across all age groups and demographics. Our bricks-and-mortar stores have been extremely profitable and we plan to open more across Australia and internationally in the future. IR: How do you think the cost of living and other economic challenges will affect July in 2023? RL: We use publicly available airline booking data to predict how busy we anticipate being, and currently the data is showing that Australians will be travelling extensively this year. The way people travel is constantly changing and evolving, but excitement and exploration is truly a part of our DNA as Aussies. We don’t think the increases in cost of living will affect July’s performance in 2023, because people were not allowed to travel for the two Covid years. All the people I’ve spoken to have made plans to travel in 2023 or the year after. IR: How do you plan to expand the business in 2023? RL: Global expansion is an important part of July’s strategy and in June 2023, we’re planning to enter the European and UK markets [online]. We don’t have international retail stores just yet, but they’re certainly in our plans. Any stores that we open across Australia and internationally will have the same look and feel as our current spaces. It’s important to us to maintain the essence of the July brand as we move to a global stage. IR: Do you expect to face any major challenges in 2023, and if so, how will you navigate them? RL: We predict that further international expansion will be our biggest challenge in 2023. Learning new markets and making a splash in some of the most competitive commercial settings worldwide won’t be easy, but we’re really excited for the challenge. We’ll engage with experts we can learn from and spend time on the ground wherever possible. Additionally, the international difficulties with supply chains have been well documented, but they are an ongoing issue. We’re predicting that procuring stock may be a concern, so we’re planning and ordering much earlier than we have previously. IR: Are there any other goals or future plans that you’d like to share? RL: We want to open more stores across Australia and keep developing great products that our customers love. Our mission is to become an iconic Aussie brand and export – and we’re well on our way to achieving that goal. This article was originally published in the 2023 Australian Retail Outlook, powered by KPMG. Download here.