The company's first-quarter results were announced yesterday, showing a jump in active customer numbers but a decline in gross margins. The company said one reason for this was that sites which avoided charging GST were costing it sales
After the Australian Government made it compulsory for all online purchases to be charged GST, Kogan saw a rise in sales as many of its competitors shut down, The Australian reported.
But the company now says that foreign online retailers are avoiding GST and this is eating into its sales.
Revenue in the exclusive brands line went up by 15.7% while revenue from partner brands rose 73%.
“While growth in the global brands division presents a challenge to the business in the short term, we have built a resilient portfolio of businesses, with the core divisions of exclusive brands, partner brands and Kogan Mobile continuing to show healthy growth,” Kogan founder and chief executive Ruslan Kogan said.
“We continue to execute our long-term strategy to grow our ecommerce footprint and make the most in-demand products and services more affordable for all Australians.
“We are better prepared for this busy Christmas sales period than we’ve ever been with warehouses in Victoria, New South Wales, Queensland and Western Australia fully stocked with the most in-demand products.”