Andrew Heathcote Rich Lists editor

Andrew is BRW's Rich lists editor and is responsible for the Rich 200 and Young Rich flagship issues. He also reports on matters relating to wealth and investment for BRW and The Australian Financial Review.

View more articles from Andrew Heathcote

Reject Shop’s $2m flood barrier protects Ipswich distribution centre

Published 29 January 2013 11:43, Updated 30 January 2013 10:48

+font -font print
Reject Shop’s $2m flood barrier protects Ipswich distribution centre

The Bremer River has again flooded into Ipswich as towns across Queensland and NSW were hit with the after-effects of tropical cyclone Oswald Photo: Glenn Hunt

The Reject Shop has activated its $2 million flood barrier system at its crucial Ipswich distribution centre in an attempt to prevent the Queensland floods crippling its business as they did in 2011.

The inflatable system, which it acquired in March 2012 and sits around the whole building, demonstrates the lengths some businesses will go to protect themselves from the devastating impacts of floods.

Cyclone Oswald and the resultant flood waters have inundated Queensland and northern NSW.

Queensland’s Premier Campbell Newman says 1250 business properties are likely to be affected by the rising water.

Floods are nothing new for The Reject Shop. The Melbourne-based business had only recently completed its $16 million distribution centre in Ipswich when the January 2011 flood forced its closure. Stock shortages and recovery costs hurt the business and contributed to a 31 per cent fall in net profit for the year to June 30, 2011.

Since re-opening the distribution centre, The Reject Shop has improved revenue and earnings. Over the past 12 months, The Reject Shop stock is up an impressive 42 per cent in an otherwise gloomy retail market.

The managing director of The Reject Shop, Chris Bryce, says the decision to erect the barrier system around its main distribution centre was made as a precaution.

“While the predicted and actual flood level did not indicate flooding of our site, we believed it was prudent to implement protection measures given the impact on the business of the 2011 floods,” Bruce says.

The floods have also had a small impact on some other stores.

“In addition to the flooding in Ipswich we have had some store closures over the past few days throughout Queensland and NSW due to localised flooding but no reported damage to any store at this stage.

“We have had difficulty delivering stock to some stores due to road and rail closures and expect this to continue over the next week.”

In morning trading, the market responded well to the assurance from The Reject Shop that floods have not had a major impact on their business this year. In early trading, the stock is up 4¢ on Monday’s closing price of $15.49.

Comments