Apparel Online Bangladesh Magazine July Issue 2018 | Page 67

WORLD WRAP
brand retailers – that which will
refocus on the strongest and most
profitable parts of businesses.”
No doubt, the year gone by was a
determining year for Australian
retail, as two major retail movements
heated up activities in the market.
On one hand, French-owned retailer
Décathlon opened its first bricks-
and-mortar store in Australia in 2017
and on the other hand, the long-
anticipated arrival of Amazon was
realised. The arrival of Amazon is
expected to shake up the market and
give it new directions. “As Amazon
builds out its infrastructure and
services in Australia in 2018, we can
expect its presence and influence
on the market to grow significantly,
particularly in the second half of the
year and in the lead up to Christmas.
We’ll have to wait and see the ultimate
impact of Amazon’s onshore business
in Australia, but it’s important to
remember that this also creates
opportunities for Australian retailers,”
opines White.
Internet retailing has become an
increasingly important channel for
apparel and footwear retailers. In 2017,
the channel continued to increase its
value share in apparel and footwear,
driven by Australia’s high mobile
penetration and the growing number of
consumers opting to shop and browse
for products online. With e-retailing
coming of age, Alibaba too opened its
Australian headquarters in Melbourne,
JD.com is expected to follow shortly,
and Vipshop Holdings (VIP.com) opened
its new distribution centre in Sydney.
In fact online retail spending in
Australia is forecast to hit a double-
digit proportion of total retail spending
in 2018, currently sitting around
seven per cent. The push has been
accentuated with a wide range of
retailers reporting strong online
growth over Christmas 2017; moving
forward in 2018, the focus will be
on both pure online platforms and
omnichannel retailers. In this quest,
speed is emerging to be at the forefront
of the fight. More so as Australia is a
geographically challenging market for
retailers and logistics providers.
The frontrunner in the race for speed
is without doubt Amazon which is
expected to launch its Prime and
Fulfilment by Amazon programs
locally in 2018, that will necessitate
a significant investment in logistics
capabilities, bringing in a new level of
speed for thousands of its partners.
Speed is also shaping up to be a focus
for stores, as the likes of Woolworths
and Super Retail Group invest in faster
click-and-collect models and predictive
data analytics software to better
understand customer demand.
To keep up the retail business in
the country, new laws are being
implemented. In the past financial year,
Australian customers spent about US $
40 million to purchase low-value items
(less than US $ 1,000) online, from
offshore destinations. Since customers
did not pay any GST on low-value
items, nor any other taxes, duties or
charges to bring the product into the
country, it was a good deal. However,
from July 1, 2018 GST will become
applicable on items under US $ 1,000
also. According to retail analysts, this
will ‘level the playing field’, as overseas
retailers who are sending goods worth
more than US $ 75,000 a year into
Australia must collect the GST and pay
it to the Australian Government, which
could in fact mean more business for
local retailers.
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September 2018
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