A quick read of the headlines would indicate it’s been a rough start to 2018 for the retail sector, with Toys ‘R’ Us in trouble, and retail spending weaker than expected. It’s not all doom and gloom, however, with technology tempering the sentiment.
Here’s an insight into what’s making the recent retail news.
Toys ‘R’ no longer us
Inside Retail reports Toys ‘R’ Us Australia and its sister brand Babies ‘R’ Us have gone into voluntary administration after a proposal to purchase the Australian arm of the company was withdrawn.
The move follows the recent collapse of US-based Toys ‘R’ Us, but there remains hope the Australian division will be picked up by a willing buyer.
Over 40 retail stores and 700 staff are affected but will continue to trade as options for a potential sale are explored.
Big data a big help
Big data is playing a big role in ensuring the viability of real-world retail, according to trade journal Women’s Wear Daily (WWD).
They note despite talk of a retail apocalypse, the US holiday season saw a surge in sales, largely due to the innovation afforded through retail analytics.
“…big data played a fundamental role in this digital transformation and revolutionised the way retailers are now operating.
“Through data insights and grasping the consumer behavior patterns from multiple channels, retailers have been able to effectively execute marketing campaigns and personalise the customer’s shopping experience to meet their heightened demands.”
Shopping and the mobile camera
Mobile phones are playing an even greater role in the shopping experience, according to Business News Daily, who note consumers are using their smart phone cameras to assist with purchasing.
Cameras are being used for three main purposes:
- To scan barcodes while comparison shopping
- To snap a photo of an item and then shop for it online, and
- To See virtually what something would look like in their home or office
Retail as a service
Chinese retail giant JD.com is making a play to assist Australian retailers, the Fin Review claims, and could offer technologies such as unmanned checkouts, facial recognition-driven marketing and automated fulfillment to Australian retailers within 12 months.
As a major e-commerce retailer, JD.com recently moved into real-world retail, noting its technological skills like predictive analytics, big data and artificial intelligence, could give it the edge offline.
Now it’s looking to offer that tech to other retailers as part of a focus on helping Australian brands join its giant Chinese market place, and embrace new target markets of Indonesia, Thailand and Vietnam.
Weak March quarter retail figures
The joy of Christmas was quick to subside for retailers, with Australian Bureau of Statistics figures for the March quarter of 2018 revealing lower than expected retail trade.
The ABC reports: “In seasonally adjusted terms, overall retail sales exhibited no growth over the month.
“The result was weaker than an already weak market forecast for 0.2 per cent growth, a slowdown from 0.6 per cent growth in February.
“Only food sales recorded a significant rise. Household spending, clothing and accessories and department stores all went backwards.”
The sales begin
Low retail trade figures and a warmer start to winter than expected have forced Myer to kick off the stocktake sale earlier than usual, and others are expected to follow suit.
The Australian says it signals “fashion and apparel retailers could be about to panic and release a deluge of sales to rid themselves of unwanted winter clothing in the face of the warmer start to the colder months”.
GST and low value imported goods
The local retail sector will be the beneficiary of a new law that sees GST applied to low value imported goods as of July 1.
The Australian explains: “In the past financial year, Australians spent about $40 million on low-value items (less than $1000) online, offshore. We pay no GST on low-value items, and we pay no other taxes, duties or charges to bring them into the country. However, this is all about to change.”
They also note: “In addition to the GST expansion, the Department of Home Affairs is considering whether to slug us all with a new import levy of up to $7”.
The American shopping mall may have taken a hit in recent years, but a new theme park is set to immortalise it forever.
Barrons reports that plans are afoot in Miami to build a US$4 billion, 6 million square feet retail theme park that will employ 14,000 people and draw an estimated 30 million visitors a year. It’s called the “American Dream Miami”, and if it goes ahead would be the largest mall in America.