Australia’s Retail Dilemma

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Australia’s Retail Dilemma

21 March 2012 Hits:3026

Now I don’t doubt that some retailers are struggling and I understand their call for GST, customs charges and duties to be added to online purchases under $1000.  However, a Productivity Commission Report found the cost of tax collection would exceed revenue raised.  The Federal Government’s retail task force is still examining this issue.

Australians are not going to stop buying certain goods online.  Each household only has so much discretionary money and although we try and buy Australian, we also need to make wise financial decisions.  So, Australian retailers have some work to do to encourage us to buy from them.

In recent weeks I’ve needed to update my wardrobe for Bayside TV.  I’ve chosen to buy the clothes in local shops but it’s been a very mixed experience.  In general the department stores offered atrocious service.  One in particular had three staff members standing around talking while customers were waiting.  I asked them for help but was told they worked in another department and so could not assist me.  When I asked who could help me I was told that someone would be there shortly.  Fifteen minutes later a staff member arrived.  In the meantime customers had walked out.  I had planned to spend more in that store, but chose not to because of my experience.

The best service was given in the smaller boutique shops although that was not always the case.  One men’s clothing shop I went into had some really nice shirts but the girl “working” there spent ten minutes talking to a friend on her mobile phone.  She didn’t once acknowledge me. I had several hundred dollars to spend and I would have spent it in that shop but I walked out and bought the shirts elsewhere.

Good service has got to be the number one key to the survival of Australian retail.  No wonder Apple is now the world’s most valuable company.  You walk into an Apple store and a friendly person comes to you straight away, asks your name and how they can help you.  The service is amazing – and so are the products.  If good service isn’t offered why shouldn’t we buy online?  What value is added by shopping in a store?

And so, as a shopper, I give this advice to retailers:

• Train your staff well so they know how to serve well.  And give your staff incentives for good results.
• Give something for nothing – a discount voucher or frequent shopper bonus; buy two get one free or discounts for large purchases.
• Develop online buying yourself. If people want to buy your products online why not give them the opportunity.
• Keep up to date with current trends, innovations and technology. Remember Kodak, the company that pioneered the digital camera was eventually brought down by its failure to invest in its own ground-breaking invention.  It became a fossil because it came to a point of change and failed to make the transition.

It’s not good enough for retailers to complain about competition and expect the government to bail them out.  It’s time for all retailers to realise the world has changed and to do the hard work of remaining competitive and give us, the shoppers, good reasons to buy from you.

Rob Buckingham

Senior Minister

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One reply on “Australia’s Retail Dilemma”

Michael Gilmoursays:

I work in the online industry and manage over 1 million domain names with over 10 million people per day going to them….and Rob, you are spot on! Retailers need to retail to customers and if those customers are going online then they also need to be online. I would also like to suggest that some retailers have built business models around huge margins and now that these margins are under threat their business are as well.

For example, I went to a book store recently and saw a book for $35 that I saw the previous week online at Amazon for $10. I asked the store manager the reason for the price difference and he spun a story around shipping costs. If that was the reason why then he should buy the books from me one at a time and I’d buy them from Amazon….the fact is he was make massive margins.

I was recently in the USA with my family and we spent up big on clothes. I’ve come to the conclusion that it should be a bi-yearly trip as we saved so much money that the savings offset the cost of the airfare.

On the issue of service. I’m always happy to pay more if the service is good….my experience has been that it’s poor. I’m tired of poor service….it’s exhausting. The majority of sales people are young (because the wages are less) so I’d love to challenge young people….be different and provide excellent service and make it your goal to make your boss successful. This attitude will follow you all your life and trust me when I say you’ll never be out of work and the chances are any businesses that you start will flourish.

Cheers!

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