‘Retail Elephants’ are dancing and ‘Retail Ants’ are dying..?

‘Retail Elephants’ are dancing in Australian malls and ‘Retail Ants’ are dying in Australian malls!

We have been trying to get a snap statement which sums up the competition imbalance in Australian Shopping Centres; we have found it.

‘Retail Elephants’ are dancing in the malls and ‘Retail Ants’ are dying in Australian malls sums it up perfectly.

Tango major retailers leading their tango partners the Australian Shopping Centre Industry in a property grab dance, killing off the small retail sector ants.

The thumping of elephant feet is reflected in the total imbalance in occupancy cost in Australia’s closed market Shopping Centres between the major retailers and Australia’s specialty chains, medium and SME retailers.

• Occupancy costs for the massive space using major retailers run at 3-7% of sales; occupancy costs for Australia’s specialty chains, medium and SME retailers run at 8%-25% of sales; many lines purchased from the same supplier and importer pool.

• Has not these always been so you say; NO, when there was a free property market prior to the explosion of Shopping Centres the major space using retailers has an occupancy cost of 3-7% and the specialty chains, medium and SME retailers have average occupancy costs of 4-8%.

• Every time a State of Local Government opens up retail development the Shopping Centre Elephant courts the Major Retailer Elephants and they start ‘space take dancing’.

• The effect, regularly squashed specialty chains, medium and SME retailers trying to avoid the dancing feet of the major retailers with their weekly tango category discount dances; they could not afford to discount so hard if they paid real rents.

To the Shopping Centre elephant who on many occasions has his or her feet trodden on by Major Retailer partner says, “without this courtship Shopping Centres could not be built”.

We say, when the early days of Shopping Centres were you did it, internationally you still do it; then why not now in Australia in 2009.

It is all about making the major retailers pay a fair price for space occupied, not making the small retail sector act as a rental charity for powerful major Australian retailers’ and their Shopping Centre mates?

A pure competition issue created by well meaning local and State planning authorities; up to Minster Craig Emerson Minister for Small Business and Competition to clip the dance ticket.

To make an Elephants dance Contribution email Retail Elephants vs. Retail Ants

Tony Standley

Principal
The RETAiL Alert Group (Australia)
Mobile +61 (0)41 924 0497
e-mail info@adsass.com.au
Fax +61 (0)2 9987 0633
Website http://www.retailalert.com.au
 
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