Glassons has been updating the look of many of its stores.

A warm autumn and management problems at Glassons are getting the blame for a drop in Hallenstein Glasson's profits.

The clothing retailer said it had made $223.51 million in sales in the year ended August 1, just 1 per cent up on last year.

But Hallenstein Glassons' profit was down 21.3 per cent to $13.68m.

The group owns the Glassons chain in Australia and New Zealand, Hallenstein Brothers, and Storm.

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Hallenstein Glassons said part of the profit drop was due to the exchange rate.

But there had also been problems getting effective management for Glassons, which had caused a lack of product continuity and fashionability, it said.

"That key issue was addressed with the appointment of Di Humphries in April," the retailer said.

"A significant restructure of the Glassons product team has been completed, and since June 2016 we have begun to see an improved performance in both sales and margin.

"Sales in New Zealand for the first six weeks of the financial year have improved 21 per cent over the prior period. Margin is also showing a strong improvement."

But weather had also been against the brand.

"Record mild temperatures on both sides of the Tasman during early winter resulted in key winter categories failing to match last year sales.

"A return to normalised (sic) winter temperatures has allowed the company to trade through winter stocks although this had been at a lower than usual margin."

Online sales grew 24 per cent in the year and represent about 7 per cent of total turnover.

Retail analyst Chris Wilkinson, of First Retail Group, said the biggest challenge for Glassons was that the fashion retail sector was changing quickly.

He said that was driven by the arrival of retailers such as Top Shop, Zara and H&M, but also the online presence of ASOS and Boohoo.

"They're very much at the forefront of this fast fashion."

Wilkinson said the online retailers were making good inroads into the New Zealand market and had the ability to very quickly design new ranges, test them and go into production.

"Online retailers tend to be more agile in response to the market and are even starting to influence the market," he said.

While Glassons was doing a lot right with its new-look stores, Wilkinson said it faced a big challenge to keep up and carve out a place as an influencer.

"There are many more players in that channel now and they are playing in a space that is increasingly drive by online. Teens, tweens, millennials and generation z ... they're all incredibly connected and making decisions on the fly."