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The famous Israeli retail chain Castro is launching a surprise one-time sale: only 33.3 shekels for a men's or women's item when buying three items in stores (3 x 100), 20 NIS for children and babies (3 to 60).
It is assumed that these are unprofitable prices for the network. In addition, all products for men and women on the Castro website will cost up to NIS 33.3 excluding quantities and up to NIS 20 for babies and children.
It follows from the announcement that these are not old stocks, but a sale of the entire latest autumn-winter collection for 2022. Shoppers on the site will also enjoy free home delivery on purchases over NIS 199.
The sale at such low prices is indicative of significant stockpiling as a result of weak winter clothing sales. High-level industry sources say that at this price it would be better to destroy the goods and write them off rather than sell them at loss-making prices so as not to damage the brand, and that perhaps the consideration for a sale is dictated by a desire to strengthen cash flows.
Castro was in a fashion slump even before last winter. The company's third-quarter 2022 reports show it ended it with a net profit of just NIS 5 million, an 80% drop when store sales fell 4.5% as a result of declining sales in Castro's core business of apparel. resulting in an operating loss of NIS 7.8 million compared to a profit of NIS 21 million last year.
this pushed the end of the sales season to a later date. At the same time, in the majority of chains, the accepted discounts range from 50 to 70 percent on average, or two items for one price. The industry's weakness is reflected in Reese's data for December last year, which recorded a massive 7.5 percent decline in sales. This is also a decrease compared to November, when a decrease of one percent was recorded.
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