It’s getting tougher out there for our retailers
Ask most retailers, and they’ll tell you it’s a tough, competitive environment out there. Recently, we’ve seen a number of established businesses hit the wall, under the twin assaults of online shopping and the entry of international brands. The bad news is: it’s not about to get any easier.
Earlier this week Herringbone and Rhodes & Beckett, both owned by German-based luxury brand van Laack, called in the administrators. These businesses collectively operate 29 stores nationally and employ 140 staff.
We’ve also seen the recent demise of David Lawrence, Marcs, Allphones, Dick Smith, Pumpkin Patch, Payless Shoes, Masters and Howards Storage World.
With “on-line” capturing 7 per cent of the retail dollar and moving to 10 per cent, penalty rates on a Sunday plus payroll tax ensuring a sales person costs their employer close to $50/hour, high rents and the competitive landscape changing with the entry of Zara, H&M, Uniqlo, and soon Amazon, it is unsurprising a number of our branded and independent retailers are under the pump.
“Retail” is our second biggest employer, behind “Healthcare and Social Assistance”, accounting for 11 per cent of our workforce of 12 million people.
Following on from Roger’s blog yesterday the hollowing out of the Australian economy simply makes us more vulnerable to any international shocks and particularly to weak commodity prices.
It makes me wonder how many of my children’s generation will need to polish up their barista skills?
Chief Executive Officer of Montgomery Investment Management, David Buckland has over 30 years of industry experience. David is a deeply knowledgeable and highly experienced financial services executive. Prior to joining Montgomery in 2012, David was CEO and Executive Director of Hunter Hall for 11 years, as well as a Director at JP Morgan in Sydney and London for eight years.
This post was contributed by a representative of Montgomery Investment Management Pty Limited (AFSL No. 354564). The principal purpose of this post is to provide factual information and not provide financial product advice. Additionally, the information provided is not intended to provide any recommendation or opinion about any financial product. Any commentary and statements of opinion however may contain general advice only that is prepared without taking into account your personal objectives, financial circumstances or needs. Because of this, before acting on any of the information provided, you should always consider its appropriateness in light of your personal objectives, financial circumstances and needs and should consider seeking independent advice from a financial advisor if necessary before making any decisions. This post specifically excludes personal advice.
