Thinking of Buying a Footwear Retail Business in Australia? Here Are 3 Vital Questions to Ask

Australia’s footwear retailing industry generates $3.2 billion in annual revenue, supported by over 5,000 businesses and employing around 23,300 people nationwide.

Average profit margins sit at 5.6 percent, with the industry recovering after pandemic retail disruptions, supply chain shocks and shifting consumer spending patterns. Revenue is forecast to grow 1.2 percent annually to 2030, driven by athleisure demand, online shopping growth, and the increasing popularity of global brands.

1. Is the Business Financially Sustainable in a Highly Competitive Retail Market?

Why It Matters:

Footwear retailing is heavily influenced by consumer spending, fashion cycles and global supply chains. It is a mid margin business that relies on strong stock control, supplier relationships and product mix.

Many retailers face pressure from rising import costs, discounting behaviour and slowing discretionary spending. Understanding financial resilience is critical.

What to Check:

• Margin performance compared with the 5.6 percent industry average, noting that stores with premium branded footwear typically achieve stronger margins.

• Inventory management systems, stock turnover rates and the risk of holding outdated fashion lines.

• Supplier agreements for major brands, as holding rights to popular labels significantly boosts foot traffic.

• Cost structure, including rent, staffing and freight costs, all of which have risen in recent years.

• Online versus in store sales balance, especially as ecommerce now accounts for a large share of footwear purchases.

2. How Competitive and Well Positioned Is the Store Against Major Retailers?

Why It Matters:

Competition is intense. Major players such as Platypus, Skechers, Athlete’s Foot, Hype DC and department stores dominate brand access and marketing influence.

Independent footwear retailers must differentiate through service quality, niche product selection or strong community presence.

What to Check:

• Whether the business holds key brand distribution rights that large chains may not stock.

• Store location quality, including visibility, pedestrian traffic and proximity to complementary retailers.

• Local competition density and the presence of major chains in the same catchment.

• In store experience factors such as fitting expertise, customer service standards and product breadth.

• Marketing effectiveness, including loyalty programs and digital advertising presence.

3. Is the Business Aligned with Long Term Retail and Consumer Trends?

Why It Matters:

The footwear industry is shifting towards online sales, athleisure demand and sustainability driven consumer preferences. Retailers must stay ahead of these trends or risk losing relevance.

What to Check:

• Ecommerce capability, including website speed, product photography, delivery options and return policies.

• Strength in growing product segments such as athletic footwear, outdoor performance shoes and sustainable materials.

• Use of data analytics to manage stock and predict demand based on seasonality and fashion cycles.

• Investment in technology such as automated inventory systems and modern POS tools.

• Ability to adapt product ranges quickly in response to changing fashion and brand trends.

Ready to Invest in a Thriving Footwear Retail Business?

Footwear retailing offers strong potential for operators who maintain excellent stock management, secure high demand brands and provide an engaging shopping experience both online and in store.

Success depends on product mix, digital capability and competitive positioning in a rapidly evolving retail environment.

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