A retail analyst says the outlook for the sector is bleak, but is not ruling out a pick-up later in the year.
Forsyth Barr analyst Guy Hallwright says the retail sector is proving a hard fought market with intense competition, particularly in womenswear.
Hallenstein Glasson warned on Wednesday that its half-year profits could fall up to 18%.
Mr Hallwright says consumers seem reluctant to spend and it's hard for stores to drive sales.
He says the economy is being driven by good earnings from exporters, and the signs are there for a steady improvement, but it won't be a rapid turnaround.
"We haven't seen much growth in retail sales for about three years now," said Mr Hallwright.
"(However,) it is still possible there could be a pick-up later this year."
Shares in Hallenstein Glasson fell 24 cents to $3.86 on Wednesday.