The Paire shopfront is boarded up, but make no mistake: the brand isn’t going anywhere.
Instead, the Australian apparel brand is outfitting a new flagship store in the heart of Melbourne, defying a consumer spending downturn and inverting the relationship between physical and digital retail.
Paire, a retailer of high-end socks, t-shirts, and loungewear, plans to open its new store in the city’s upmarket QV shopping complex.
It will replace a pop-up store, which Paire co-founders and Smart50 finalists Nathan Yun and Rex Zhang hoped would complement their growing e-commerce business.
The experiment was a success.
Paire is now working with architecture and fit-out experts In Addition and Trust Projects to transform the premises, which will re-open in September.
Its development coincides with a tough economic environment, reduced discretionary spending, and a surge in external administrations.
Speaking to SmartCompany this month, Yun and Zhang explained why the brand is committing to a new flagship, at a time when retailers across the country are looking to reduce costs as much as possible.
The brand’s sales over the Black Friday, Cyber Monday, and Christmas periods exceeded expectations, Zhang said.
But it was Paire’s results through the quieter post-Christmas period that convinced the brand a permanent retail space was appropriate.
“I think it purely comes down to numbers: how much profit we have been making, even through the busy period and through the quiet period,” he said.
“And even with the current performance, we can afford a bigger space with a bit higher rent, and still easily make it break even, and make profit.”
https://www.instagram.com/p/C701WLzvLgs/?img_index=7
Yet in-store sales are only part of the story.
Yun, who champions Paire’s e-commerce operation, suggested customers who experience its products in person may be more likely to visit its online sales channels.
“We do see [the store] helping the online marketing channels, lowering its [customer acquisition costs], driving in more customers,” he said.
Beyond the stats, Yun said the brand has a “gut feeling” that physical space is contributing to success online.
“Obviously, the whole environment has been down — we do talk to a lot of brands around us,” Zhang added.
“But surprisingly for Paire, we have seen a big growth since we opened the retail store.”
Paire will be in good company when its new store opens, with brands like Aesop and fellow Smart50 success story July operating retail stores just steps away.
The July team also offered advice to Paire before it committed to a pop-up.
Yun admitted his initial scepticism, but said Paire is still taking inspiration from the luggage brand.
“That has pretty much been the main advice they’re giving us: offline is really, really powerful for any online businesses,” he said.
External retail experts agree that the right physical space, opened at the right time, can help digital-first brands flourish.
Yet businesses considering their own forays into bricks-and-mortar retail must closely consider their location and target clientele.
For now, Paire thinks it has the right formula: a presence in one of Melbourne’s shopping hotspots, among a slew of aspirational brands.
And just like its online channels can quickly adapt to customer preferences, the brand says the flagship store will change over time.
“We’re also constantly evolving, and we’re sure the store is just going to evolve with us,” Yun said.
Entries for the 2024 Smart50 Awards are now open. Nominate your business here.
Never miss a story: sign up to SmartCompany’s free daily newsletter and find our best stories on LinkedIn.
Smart50 is SmartCompany’s suite of award programs for Australian small to medium size businesses. The Smart50 Awards 2024 recognised the top 50 fastest growing companies in its Smart50 list, and celebrated exceptional achievements in community, innovation and more in the Smart50 category awards.
Senior Business Journalist
Focused on the small business sector, David’s work covers the political, regulatory, and economic issues facing Australian entrepreneurs. Prior to joining SmartCompany, he was a reporter for Business Insider Australia. You can follow him on LinkedIn.
