Retail, More Specifically Brick and Mortar Going Bust - Are we (OzBargain Community) Playing an Active Role in it?

LFindMeADeal on 17/01/2020 - 10:18

All of a sudden there is a Tsunami of store closure announcements.

A lot of senior execs from these stores have blamed the bargain hunters going online to compare prices domestic and in overseas markets. Some have made general comments like, it is getting hard to have a USP apart from cheaper prices. How true are these comments?

We, as Ozbargain community take pride looking for cheaper prices. That made me wonder how much role are we playing in all this? And isn't this natural anyway?

Other facts and questions:

1) Online shopping has been around for ages now, so nothing new. So what has changed now and why these execs are pointing to buyers that shop online?

2) I have always been a conscious buyer and ALWAYS compared prices (brick/mortar or online), was there a generation that didn't do that and just bought what was in-front of them?

3) Where do we go from here?

All thoughts welcome.

General Discussion

Comments

  • obit11 on 17/01/2020 - 13:08
    +2

    I feel like retailers are going about their future incorrectly. I know with my employer, it seems the goal is to get stock on shelves. Now if I'm a consumer, I'm going brick and mortor for customer service. Basically everything I could want is delivered in a day or at worst two from Amazon. Without customer service, why bother going to a retailer?

  • try2bhelpful on 17/01/2020 - 13:26
    +2

    My first “go to” is a B&M store because I walk out of the door with the goods. No “will they actually deliver it” anxiety. It also means I have somewhere to go if something goes wrong. None of this “postage return” rubbish. I am willing to pay a smallish premium for this.
    My next “go to” is online stores that a decent reputation. I use my parcel locker for deliveries, if I can, because the BS of waiting for deliveries is annoying and there is no “but we delivered it to your house” rubbish.
    My last is “this looks ok, and is good value, I’ll roll the dice”. I won’t be surprised if deliver doesn’t occur and am willing to wear the loss, or chat to my credit card place about non delivery.

    The face of retail is changing. You only need to look at the number of empty stores around. Even the “popular” shopping areas have vacant properties - some that have been that way for over a year. There are also a number of “closing down” places that advertise their online addresses.

    The whole thing is very complex. Housing is very expensive, the future of employment is uncertain, it is much easier for businesses to have online rather that store “fronts”. No one “answer”.

    Sites like this, certainly, make comparisons easier and it, also, weeds out the more dodgy operators.

    I think “blaming us” is not valid. I think the future of retail needs to be based on an analysis of what is best handled “face to face” and how to improve the shopping experience to get people into shops. What ”value add” can you have. I’m OK to buy electrical goods online, but I like to see my fruit/vegetables/meat when I buy them.I prefer to buy clothes I can try on. A glass of bubbles helps the hair dresser experience. The tasters at Costco make you more likely to buy something you aren’t familiar with. The next level of retail needs to be about innovation and differentiation. Come to my store, you will enjoy the experience.

    • GG57 on 17/01/2020 - 13:48

      You had me until the hairdresser experience. We might struggle to get that service online.

      • try2bhelpful on 17/01/2020 - 14:15
        +2

        However, reminds me of a Dolly Parton comment.
        “People always ask me how long it takes to do my hair. I don’t know, I’m never there.”

      • de9299 on 17/01/2020 - 16:08

        I personally prefer a beer when my hair is "dressed". My barber has collab craft beer with a local brewery. So now I've been drinking that brand of beer as well.
        /offtopic

        • try2bhelpful on 17/01/2020 - 16:10

          Never got into beer; more of a Chardy girl, myself - but bubbles is a reasonable substitute.

    • Hybroid on 17/01/2020 - 16:57

      That's an interesting perspective but I would say mine is the complete opposite. My first go-to is online shopping, primarily Amazon, knowing that if the product's available in stock, it'll usually be the cheapest price available and be safely delivered by X date quoted to parcel locker. No more worrying about getting to a shop, whether or not they have stock, queues etc. I would actually pay a premium for that hassle-free process.

      I can walk down to JB Hifi on a Friday game launch day during lunch break hoping they still have copies for sale or I can order off Amazon and know it'll be waiting in parcel locker when finish work and head home for weekend. Works like clockwork every time.

      Returns are also hassle-free with free returns labels generated and printed yourself then pop it into post office or get it collected if bulky/heavy. No having to haul it back to a store, no queuing up to the returns desk, no waiting for someone to look over your item and processing refund, no waiting for a manager to scan their card because the cashier can't process it themselves while holding everyone up. You also get much better 'change of mind' returns with online purchases than in-store where some don't accept that.

      It's even better for things like clothing. Get to try it on at home at your leisure and comfort, order 2 sizes or multiple colours etc and simply return what doesn't fit/you don't like. Never having to deal with crowds. It's perfect.

      • try2bhelpful on 17/01/2020 - 17:20
        +1

        I can see your point but I think it all comes down to YMMV.

        The idea of pfaffing around ordering multiple sizes, then returning them, rather than just selecting them off the rack and trying them on to see if "my arse looks big in this" is not my idea of fun. I also object to all the packaging and transport that comes with all that back and forth. I don't need another carboard box to go around the cardboard box that the stuff already comes in.

        I do like to get my grubby mits on something and have a good look at it before I buy. The "well that looks a tad shoddy" bit comes into play. Also with the B&M you can look at the other 5 devices that are similar on each side and work out if one of the others is more suited to what you want. This is even more so for clothing; where touch and feel comes into play. Wander around the racks and see if there is anything that seems to suit better.

        It takes 2-3 days for Amazon to deliver the goods but I walk out of the door with my purchases from a B&M store. In America it is different where it tends to be delivered "that day".

        Hoewver, I do agree with you on the crowds during sales and stock levels. Nothing more annoying than rocking up to a store to be told there isn't any stock or looking at the massive queue leading to the checkout and the guy in front of you having 30 items in his hands :) On that note:- I think every checkout person should be sent to Costco to see how it is really done. I don't know if you've seen their trolleys but a homeless person could setup shop in one; however, the checkout people seem to be able to get through a trolley full in no time, just extraordinary. One day the person in front of me put $1000 through the till.

  • Reggie74 on 17/01/2020 - 14:13
    +2

    I believe customers are more savvy when it comes to buying clothes nowadays. For clothes I only shop at Target, Big W and K-Mart. I can spend $5 on a t-shirt at K-Mart as opposed to $29.95 on one at a boutique type. People say it's about quality but I've never had any issues with clothes bought from the department stores.

    • try2bhelpful on 17/01/2020 - 14:23
      +3

      Yeah, nah. My go to purchase, when travelling, is t-shirts. I look for good quality ones with interesting designs and the better quality ones can last a good few years.

      You aren’t getting the best quality from places like Kmart , you aren’t getting the most interesting graphical design from them either. Personally I find the whole “fast fashion” stuff obnoxious because, apart from anything else, they clog up landfill. Usually polyester blends, they go misshapen quickly and no way to recycle.

      • Reggie74 on 17/01/2020 - 14:47
        +3

        Each to their own as I've got t-shirts from K-Mart that are over 3 years old and still in good condition. Maybe some people are afraid of the stigma attached to buying from places like K-Mart but I have no issue with it and the designs are fine by me.

        • try2bhelpful on 17/01/2020 - 15:12
          +2

          I have t-shirts over 10 years old, still going strong. If I only got 3 years I would consider the tshirt a failure. It is not about “stigma” it is about quality. I don’t wear brand fashion t-shirts, I wear interesting ones. I buy them from shops, from markets, etc. I’ve had a lot of instances where people compliment me on them. They cost me a tad more but they take me back to the location I bought them from. It is the only “souvenir” I buy and I don’t buy the cheap tat ones. I choose carefully.

          • Reggie74 on 17/01/2020 - 18:25

            @try2bhelpful: That's understandable but I doubt the majority of people have that type of emotional attachment to t-shirts

            • try2bhelpful on 18/01/2020 - 07:55
              +1

              @Reggie74: Careful selection of the products we buy should be everyone’s priority. Buying something that lasts a short time, then ends up as landfill, is a terrible waste of resources. Not an emotional attachment but an intellectual one. If I buy something I expect to get a good amount of wear out of it and I like it to be interesting. T-shirts are one of my wardrobe staples, it makes sense to put some consideration into what I buy.

          • trapper on 20/01/2020 - 13:01

            @try2bhelpful: I recently saw a photo of me and I was wearing the same t-shirt in the photo as I had on at the time, the photo was from 2004…. :/

        • djones145 on 17/01/2020 - 15:44
          +1

          UNIQLO!

          who doesnt wanna wear a street fighter shirt! or mario kart hehhe

          • try2bhelpful on 17/01/2020 - 15:50

            @djones145: I got a great tshirt that has images of a bunch of 80s tech on it: Walkman, big joy sticks, cassettes, etc. I’m “of the era” so it makes me laugh and reminds me of when we thought this stuff was hi tech.

  • brad1-8tsi on 17/01/2020 - 14:27
    +4

    They are crap stores with overpriced products and poorly trained staff.

    JeansWest - probably bought 2 things in 30 years. Everything you try on the staff say "that looks great" an it looks crap.

    Harris Scarfe was like going back in time 50 years without the customer service.

    • godofpizza on 17/01/2020 - 14:28

      are these the SA stores? i went there about 10 years ago and it reminded me of myer melbourne stores from the 80's with their wooden ramps.

      • brad1-8tsi on 17/01/2020 - 15:03

        They had some in regional NSW.

    • MessyG on 17/01/2020 - 21:13

      I so agree, Jeanswest was relevant for a minute in the early 2000s, I'm surprised they lasted as long as they did and Harris Scarfe I'm surprised ever existed at all. There was absolutely nothing defining about that place.

  • ozito on 17/01/2020 - 14:27
    +3

    Well, my thoughts are:
    1)Don't have a +100% margin to begin with. Sooner or later customers will catch up and will find alternatives.
    Aldi/Costco are seriously threatening Woolies/Coles so if they closed down tomorrow, they have no one else but themselves to blame.
    2)Give a good service without a fuss.
    Personal service support cannot be replaced with online bargain shopping. If they provide really good service and support without charging again on top of what they already have made profit of earlier, a customer will never go online.
    Remember once disgruntled, dejected and looked down upon customer will go to any lengths to make sure the culprit business party feel the heat.

    • TEER3X on 20/01/2020 - 19:36

      Meanwhile Woolworths continue to post record profits

  • Strahany on 17/01/2020 - 14:49
    +13

    Commercial rental costs will be a large part of the blame. Landlords, especially those in shopping centres (looking at you, Westfield), are still charging the rents they were when the economist was going well, and B&M stores were popular. It doesn’t help that many major stores happily cough up these costs, because they need the “brand presence”. This would artificially inflate the price for all other shops, you’d think, as it sets the standard.

    In addition, I think the rise of dirt cheap options will continue to impact the “middle tier” shops. For example, you can go to Kmart for cheap homewares, or somewhere like a David Jones or a boutique store for high end homewares. This leaves stores, like Harris Scarfe, stranded since they don’t cater for the people wanting “the cheapest”, and they don’t offer the high end options that those with plenty of disposable income desire.
    It seems that the “death of the middle class” in Australia may, somewhat, correlate with the death of “middle class stores”. The working poor will seek bargains from your Kmart, H&M. Cotton On types, whilst the rich will continue to seek “posh” options.

    • MessyG on 17/01/2020 - 21:12
      +1

      I think the difference between the retailers and the ones that have folded is that the former have stayed on brand and at the right price points. Jeans West was expensive for what it was, and of really poor quality. H&M have also stayed relevant by starting a clothing fibre recycling program and KMart and Cotton On are on trend at good price points. This is the stuff that matters to consumers, not buying a pair of Riders for $180 from Jeanswest when you can get similar jeans from Cotton On or Kmart for a fraction of that and they look just as good. The Internet has really blown wide open the margins made on clothes and everyone is just over that too.

      • LinkJah on 18/01/2020 - 15:03

        A lot of the clothes from the h&m recycling program still ends up in landfill.

    • RefusdClassification on 19/01/2020 - 12:07

      I disagree about death of the Middle Class. The vast majority of people in Western countries define themselves as middle class, even retirees whose sole source of income is a govt pension. Heaps of people can afford private schooling for their children (over 50% in the ACT), private health insurace, climate controlled houses, have 2 or more SUVs per household. A lot of workers will retire with millions of dollars in superannuation and own multiple properties worth over 1 million dollars. If anything, the middle class is expanding rather than shrinking. Our society is extremely classist, extremely vitriolic to those ho definitely don't belong in the middle class (such as the unfortunates on Stuggle Street).

      Middle class votes Labour or Greens. Proletariat vote LNP here (and Trump/Republican in America). Complete class dealignment in our mad world.

  • mrvaluepack on 17/01/2020 - 16:13

    Non of the stores that closed have ever had a front page deal at ozbargain. So i would say the opposite of what the op is saying.

    The more the store has been featured on ozbargain the better business and survivability bias it has. Look at Domino's as an example, so many front page published deals.

    • FindMeADeal on 17/01/2020 - 16:20

      Jeanswest had quite a few deals! Not sure if that was only since few weeks/months ago or always.

    • Lv80 on 17/01/2020 - 23:46
      +4

      I don't think dominos is in business because they have deals. They are in business because they are shifty AF and aren't an ethical company!

      • buckster on 18/01/2020 - 13:39
        +1

        Yeah, wait till they feature in the next wages scandal.

  • Ahbal on 17/01/2020 - 17:12
    +6

    They should adapt or die.

    ebgames for example have an rrp on an item of lets say $99. Amazon or jb (or other retail store) usually have an rrp of 70-80. Then eb has a sale, $79, but amazon or jb's sale is $50.

    Just an example.

    • capslock janitor on 18/01/2020 - 17:29
      +1

      Yeah I'm guessing similar (or not even) thing how Masters went down. New to market but same (or more) price RRP as Bunnings. If they were even a few bucks cheaper would be worth a glance to build rapport.

      Good to hear JB doing well. I really appreciate being able to look and get a feel for a product on display.

    • p1 ama on 18/01/2020 - 17:46
      +2

      EB games won't survive, just look at GameStop in the US. It'll have the same fate. Literally the same business practices and flaws.

      • Zondor on 20/01/2020 - 17:28

        Pretty sure they are the same company.

    • smartazz104 on 19/01/2020 - 10:46
      +1

      Well everyone else besides EB can sell game at a loss as their other departments will make up the shortfall. EB only deals with games, that’s why they’ve teamed up with Zing to push ove roe iced “collectibles”.

  • Ononono on 17/01/2020 - 17:44
    +6

    The retailers that actually provide value for consumers and adapted to the market seem to be doing fine. Stores like Myer and Harvey Norman deserve to fail for being so slow to adapt. On the other hand take a look at JB Hi-fi, Officeworks, Chemist Warehouse, and you can see the big difference in how they're operated and why they're successful. Consumers are smarter these days and aren't interested in being bent over by greedy retailers that offer no real value.

  • bryans on 17/01/2020 - 17:49
    -1

    Cost of business is too high in Australia especially labour.

    • stewy on 18/01/2020 - 02:38
      +4

      I'd suggest the sky high rents and fit out costs in the shopping centres is probably hitting the stores the hardest.

      • HeyHeyHeyIsItADeal on 18/01/2020 - 19:44
        +1

        Yeah isn't that the main reasaon Big W said they were closing? Depends on the rent and then BAM 3 store closure (Auburn and Fairfield and others) because rent is too high for them?

    • Ghost47 on 18/01/2020 - 15:12
      -1

      Not sure why you were downvoted. It can be argued that the car manufacturing industry here closed because of the unions. There's a reason why cars are manufactured in Thailand.

      We have the highest minimum wage in the world. People here feel entitled.

      • [Deactivated] on 19/01/2020 - 09:19
        +1

        That's not because of unions, that's because of executives

      • Zondor on 20/01/2020 - 17:17

        $20 an hour is barely enough to live on in this day and age unless you live with family.

      • TEER3X on 20/01/2020 - 19:38

        Subtract taxes and the the cost of living you end up with a negative number.

  • solidussnake on 17/01/2020 - 18:08

    So the shops closing down… When were there deals posted on Ozbargain ??? Most just are too slow to catch up on the times.

  • tonyjzx on 17/01/2020 - 18:35
    +11

    I'm ok with all these businesses closing down. We're all bystanders here. There's nothing we can do to help them.

    I was also when Westfields killed a bunch of high street stores. Myers and Big W etc closing down is a result of the decline of the 'big department store.

    Why shop at a 'generalist' when there's millions of 'specialist' stores.

    At the same time I feel we should all be cutting back on expenditure… why do you need all this made in china crap?

    I myself do not own a better than FHD TV. I dont need 4k.

    I think the middle managers need an excuse so they blame Ozbargain or knowledgeable online buyers.

    And that says it all… they want people who dont know nothing and have money!

    If you look deeply into these failed businesses they all deserve to fail.

    People never ask why successful businesses succeed.

    At the same time I have my own personal crusades… I dont buy from Amazon, I try to stay away from JB HN Apple etc. They dont need my money when they have everyone elses.

    I'm also of the belief that there largely isnt ethical consumption under our system.

    People will put out Chemist Warehouse as a success… they are a leech not paying their workers and they squeeze out competition. BUT they do have a complete range and they are cheap.

    So what to do?

    I also feel there's a sense of doom. That pending recession. We already all know that 33-40% of Aust GDP comes from China.

    So we're on the brink. Keep cash, pay down or have no debt, dont make big purchases.

    I also do not slam younger people for buying a coffee and avocado toast.

    If you cant enter the housing market then what does it matter if you eat out a little.

    • sleet on 18/01/2020 - 02:35
      +1

      Wow, actually the most sense I have read on ozbargain in a long, long while.

      Someone who actually sees both sides of the spectrum.

  • ankor on 17/01/2020 - 20:41
    +2

    I'm more inclined to blame the high cost of overheads for bricks and mortar. You have high commercial rents, wages, and a shrinking customer base who prefer to do things like pay down their mortgages.

    • geoffs87 on 17/01/2020 - 20:53
      +1

      The high commercial rents is an interesting one (I work in commercial property). Interestingly westfields charge some of the highest rents in the country… but you pretty much never see an empty shop for long in one. So although rents are high, it’s certainly a supply and demand thing…

      • plmko on 17/01/2020 - 21:53
        +2

        Commercial rent is certainly killing business viability and also business variety. But the issue is you have an unlimited wave of idiots willing to mortgage against an unviable business idea for the 'dream'…..groups like Westfields are just playing along with it.

      • buckster on 18/01/2020 - 13:41
        +2

        They can offer a cheap first year rent to fill the gap quickly, and then mark it up significantly in the following years.

  • geoffs87 on 17/01/2020 - 20:50

    I have only ever bought things I don’t need due to this website… I actually think it’s the opposite! Haha

    • Alex10 on 18/01/2020 - 12:13
      +1

      1 - Exacly.

      2 - I wasn't planning on buying a Xiaomi Whale Spout Smart Toilet Seat Pro With Warm Air Dry. Now OzB has changed my #2 forever!

  • MessyG on 17/01/2020 - 20:59
    +4

    Putting on my target demographic hat both as a female and a parent here, my two cents.

    • this all started back when the dollar was great against the US dollar. Suddenly the world opened up to us and we really saw the breadth of product that was out there, and for the first time in our lives could afford things that until that point, Australian distribution deals had ensured prices for those things were permanently high.

    • once the dollar dropped, for the first time we really saw the shitty quality we were getting compared to the rest of the world. All the chains that have folded (bar Marcs, to this day do not know how they effed that up so badly because the clothes were good quality) have been absolute poorly made jokes of products that have taken the consumer for an idiot.

    • women are huge consumers, and are also far far more likely to be environmentally conscious. The days of early 2000s style rampant consumerism are over and the crap-quality chains are yet to realise this. We know that those in power in society aren't on board with environmental concerns so we're just trying to do what we can. Buying less commercial products, or higher quality ones (of which in this country, there's not much!), and buying on consignment rather than brand new polyester is huge now and has been huge for a lot longer than all the recent climate chest-beating in the media.

    • incomes haven't really risen in a long time and mortgages are huge.

    • I don't know what has happened to fashion in the last few years but it is ugly. Uglier still when it's cheap knockoff rubbish that companies try to convince us is worth $150 for a top.

    • I think retailers have been resting on more or less the same product or variations of for too long, there's not a lot of innovation out there, just more of the same. I'm bored with it all.

    Things that would make me part with my money:

    Better quality, less polyester, less lazy cuts of garments
    Priced appropriately, not like I'm a complete idiot that doesn't know the garment cost a couple of bucks to make.
    More innovation - everything feels like it's been Kardashian inspired for a good decade now.
    Less variety (yes less, everything is done en masse which affects quality!)
    Appropriate for my day to day life (I cannot do my life in stilettos and dresses without pockets ffs)
    Eco credentials helpful but greenwashing is so rampant I'd settle for just spending a bit more on well made clothes that will last longer.

    The thing is, retailers aren't listening. They are just not reading the room, they don't care, they're just trying to push on with their crappy products and wring out the last measly bucks from us before wanting to spend the money to innovate.

    • Dogsrule on 20/01/2020 - 09:42
      -1

      "women are huge consumers, and are also far far more likely to be environmentally conscious"

      I don't think the term "environmentally conscious" means what you think it means.

      Those in power in society aren't on board with environmental concerns because nobody else is, and no, worthless, no-skin-in-the-game virtue signalling doesn't count as environmental consciousness.

      Fact is, if you live a western lifestyle, you are participating in an unsustainable Ponzi scheme, and no amount of feel-good 'green consumption' will change that. All of those men ripping vast quantities of resources out of the planet every day only do it because there is demand for those resources from the citizens of western nations (and increasingly, the rest of the world too).

      As you said, "women are huge consumers", so when you lament the environmental devastation broadcast into your home every day and bay for the blood of the culprits, best find the nearest mirror for a glimpse of your target.

      • squigglz on 20/01/2020 - 22:02

        This is a horrible take.

        It's clear that environmental concerns and sustainability are a significant force in how consumers spend money and choose brands.

        By thinking about our impact on the world and deciding to choose product B over A because B doesn't contribute to deforestation is definitely an "environmentally conscious" choice that has significant effect on business, and sends a signal that there are consumers willing to choose products on the basis of environmental impact and ethics. This is how new competitive battlegrounds emerge and markets evolve.

        I don't understand why you'd be so aggressive towards someone showing a willingness to be environmentally conscious with their purchase decisions. Your response feels like the Climate Summit comic that lists all the advantages such as green jobs, liveable cities, etc and an annoyed businessman in the crowd says: "What if it's a big hoax and we create a better world for nothing?"

        Comic here: http://theclimatebonus.org/blog/wp-content/uploads/2014/03/e…

  • p1 ama on 18/01/2020 - 01:05

    All of a sudden there is a Tsunami of store closure announcements.

    I'm not surprised - I think this has been a long time coming. Stores are extremely expensive to run. There's the cost of renting the storefront, paying for the staff, display items, consumables, electricity…etc. It's just natural that people will move to a more efficient way of doing things.

    Remember when we went to the local Blockbuster to rent movies? This is the exact same phenomena.

    We, as Ozbargain community take pride looking for cheaper prices. That made me wonder how much role are we playing in all this? And isn't this natural anyway?

    This is also unsurprising. When you cut out a lot of the expenses associated with operating physical stores, you can offer goods for cheaper and people vote with their wallet.

    1) Online shopping has been around for ages now, so nothing new. So what has changed now and why these execs are pointing to buyers that shop online?

    Online shopping hasn't actually been around for ages at all. Just 20 years ago, in 2000, people hardly bought anything at all online. It wasn't really until around 2005 or so that online shopping really took off, with the success of companies like Amazon. Even then, it was really only things like books and electronics that people would buy online.

    Buying things like furniture and groceries online hasn't really ever been a thing. Even today, I would suspect that the majority of groceries are still bought in-store, for example, vs. being bought online. The reason why this is starting to become an issue now is because of supply chain and shipping improvements that have made online shopping a better experience, as well as more and more things actually being available online (e.g. groceries).

    2) I have always been a conscious buyer and ALWAYS compared prices (brick/mortar or online), was there a generation that didn't do that and just bought what was in-front of them?

    I compare prices, but I also impulse buy a lot of things. I'm much more likely to impulse buy things in a store than online. E.g. I was just walking around JB HiFi the other day to "have a browse", but ended up bringing home a TV. Part of me feels like this is something that stores need to be able to take advantage of more if they want to stay around.

    3) Where do we go from here?

    Well I think it's pretty clear, more and more stores are going to close down. The ones that are able to compete have to be able to offer some sort of an experience that you cannot get online.

  • [Deactivated] on 18/01/2020 - 08:37
    +1

    I blame the senior execs

  • TheSmegger on 18/01/2020 - 09:39

    Innovate and thrive, stagnate and die.
    For every failure there's a success story.

    (I get my clichés in bulk)

  • mousie on 18/01/2020 - 10:36
    +1

    For me there is a trend from a traditional consumption mindset to a mindset of saving and also a scarcity mindset because there are

    Climate change debates
    Housing affordability issues
    Low wage growth
    Penalty rate cuts
    Corporate tax avoidance
    Tourism detoriation because of the fires

    There will be a surge in demand in the next few months for those affected by the fires for the replacement and reconstruction over the next few years.

    Retail brands need to actually think about their position. Jeanswest hadn't changed in years.

    I still think JB HiFi has an inventory problem and too many stores..

  • Brick Tamland on 18/01/2020 - 11:07

    I don’t think you can blame one single factor. From what I have casually observed it really is an adapt or die environment.

    The ones that do well seem to reinvent themselves and stay fresh like Kmart and JB Hifi. Other business seem to be stuck In a time warp, like Harvey Norman and Harris Scarfe.

    Then there are a myriad of other macro factors like high commercial rent, stagnant wages, very high living costs and consumers becoming very savvy with the ability to shop around on the internet. consumers know when you are selling over priced crappy made products now. Although apparently happy to buy those products if prices appropriately (Kmart)

  • Dack Smith on 18/01/2020 - 13:24
    +1

    OzBargain is causing climate change as well.

    Not just store closures.

  • Raheen on 18/01/2020 - 13:52
    +1

    Take a look at the business going under alot of them are selling clothes shoes accessories.

    1. Population is aging, consumption falls as you get older, you already have a lifetime of accumulated items to play with, not to mention living longer hence converving funds as no one wants to run out of cash in old age (especially with living cost rising fast) and then there is the desire to leave inheritance to kids (can't get my well off parents to travel while they in their 60s)

    2. Most retail spending is done by women however men have larger incomes thus have most excess funds to be spent on non necessity items, hence these funds need to be transferred from men to women in order to be spent. Alot of men dont want to tie themselves to women it's too dangerous financially/legally, easier to be a bachelor and get female attention they desire with out commitment (hence the rise of tinder, friend with benefits etc etc)

    3. Cost of housing/living has sapped alot of peoples disposable income, less to waste on trinkets (maybe younger ones woke up to the fact there is more to life then owning junk… it ends up owning you)

    4. Those youngish with cash to burn value experience over cheap chinese consumer goods, they rather travel get life experience, study or generally improve themselves.

    5. Labour market is more and more casualised, under employment is rife with that backdropped compulsive unplanned spending is less likely to happen

    6. Bricks and mortar stores are getting screwed by their suppliers (australia tax) they get screwed by their landlords, labour costs are high (Australians second highest minimum wage in the world yet many feel poorer than ever, justifiably i think) the range here is poor, the service non existent and alot of second rate products at premium prices (to cover all the bloated input costs in their businesses) add on top all HR laws, taxes state and federal, complexity with book keeping, red tape green tape, mob mentality online where you can be ruined in a second with a tweet, bad review etc.

    Personally I never pay retail on anything, prefer to by used, modernise existing items rather than buying the newest thing, hate going to shops and prefer to travel abroad have a great time for for a very reasonable price and live meekly while in Australia.. my dream which I'm working on is working remotely in Australia on Australian wages and living abroad, cut back on the hours take the jobs I want, have no restriction on lifestyle due to cost, live in places where consumerism isn't acute, where community friends family leisure are important.. lazy cruisy if it feels good do it type places, not like australia work til your drop yet die in debt (retirement age 70 yeah right go get stuffed Australia)

    • mousie on 18/01/2020 - 18:28

      Not sure who -ve you as no explanation offered. Agree on most points

    • MessyG on 19/01/2020 - 10:09
      +1

      I'll just add another dimension to the men and women bit (not that I disagree with you). The women who do have money of their own are generally out of their twenties and more impervious to advertising, more sensitive to quality, and less need to be 'accepted' by the community in terms of fast fashion. Not to mention concerned about the environmental impact - garment manufacturing is one of the most polluting industries in the world. Places like Jeanswest and Bardot really aren't going to cut it. Those shitty shops are equally not meeting three needs - price, quality and environmental impact. The cheapo places that are surviving are stores like H&M which are cheap and trying to recycle garment fibres.

  • Blue Cat on 18/01/2020 - 14:26
    +3

    Yeah well maybe people are tired paying $50 for a tshirt that is basically a $5 Kmart tshirt with $1 worth of print on it.

  • iTaco on 18/01/2020 - 14:28
    +3

    Do these companies not do market research? It's not our job to stop them going out of business.

    I see it as a lot of the sales people/staff quiet frankly are shit/disinterested/rude, so why am I going into a store to deal with there shit.

    Also things aren't made like they used to be IMO a lot of things feel cheap and poorly made, whether it's clothes or electronics. That's why if i'm going to bother buying anything anymore just for the brand name, i'm waiting for a sale.

    Also there's only so much stuff one can have. Over the last couple of years I go shopping and don't buy anything when I'm looking for an excuse to buy something and spend money but everything is just shit or I've already got what I need.

    And please these companies have been making squillions? off of us for years so why should anyone feel sorry for them. If they didn't change with the times do there research, swell that's there bad luck.

  • snajper on 18/01/2020 - 15:16
    +1

    I blame it on several factors.

    1) high rent in shopping centres (shopping centres will be forced to halve the rent in coming years due which is a positive long term thing)
    2) Some retailers like JW dropped the quality significantly over the past few years to stay afloat.( bad business decision as i refuse to buy there due to bad quality lately regardless of the price)
    3) unable to convert into proper hybrid company ( online / brick and mortar…. like JB)

  • Milk tea on 18/01/2020 - 15:38

    More stores are closing down due to many fast fashion stores appearing online where they constantly offer newer trends, more sizes, discount codes and free delivery

  • Debuting on 18/01/2020 - 16:29

    It's because there is no need to buy certain new things anymore. That's the real problem. You don't need a new TV every few years or computer anymore. That spurt that we had is now gone. I remember when there was a new gadget which came out every year; these days it's just old stuff.

    I think we also need to look at putting other B&M stores into another pile. Those types that ride a dying trend of "Hypebeast", well they were technically going bust the day they were established. Very few do it well and survive a long time.

    Even stuff that isn't B&M will probably fail over time. I'm looking at you techfast. These days you are pretty much can buy a good gaming PC and it will last you about a decade. The incremental additional benchmark score is reducing each year. Single core performance has basically stagnated or even gone backwards in the mid tier. Although, you could argue most of techfast computers are set to blow up because of the generic PSU across 5 years anyway. Maybe that's why they will survive.

    It's like my friend who bought speakers like Z5500, buy that once and you aren't really going to need to change much. Apparently some guys are still using old GPUs because they are still just as powerful, albeit less power efficient than newer ones. Think about why cryptominers were buying old stuff for a while. It was still worth it.

    Now how do we fundamentally fix it? Well you don't, unless you want to make games super freaking large that are going to stress the next generation GPU; but then you also need the video card manufacturers to get aboard on it. The problem is that there are limitations to what a manufacturer can do. Not only would that cause more environmental damage, but would stress the consumers. Maybe the way it is at the moment with less consumption is better. Maybe we don't need that many stores.

    It's catch 22.

    • freemoneyhunter on 19/01/2020 - 15:30

      I had my computer for 7 years, I5 2500 also upgraded video card to gtx960 a few years ago. The computer is still fast enough for all software out there.

  • THICKnSLOW on 18/01/2020 - 21:01
    +1

    Globalisation, free trade, migration, de-regulation.

    Clearly everything is finite and balance is way out..

    Ozbargain is just a tool, not the cause.

  • lostn on 18/01/2020 - 22:10

    It's going to happen inevitably with or without us, and it's not just Australia that will be affected.

    Amazon has been blamed for shutting down a ton of mom and grop stores in the US already.

    A Coles exec has recently said that in 10 years, he expects there to be no cashiers. It will be entirely automated. So even B&M stores that are under no threat from online shopping are trying to shed as much staff as they can.

  • haemolysis on 18/01/2020 - 23:09

    I find, probably out of need to cut low-yield sales, brick and mortar stores have a narrower range. For instance, sizing. Many stores sell basically only ‘average’ size, and if you’re smaller or larger than that, good luck finding things on the rack. Meanwhile, online stores usually have a larger size range because the entire storefront is catering to a much wider market. Better still, I can often filter by size and not waste my time at all. This is primarily why I do shopping online. Going into a brick and mortar store is really a guessing game, and usually I go home empty handed. Besides sizing it applies to all sorts of things; colour choices, add-ons, etc. “We only have the base model, in black only” is the standard brick-and-mortar answer.

    • Milk tea on 20/01/2020 - 11:43

      I agree. Sizing and range is very limited in store so many people go online and buy the items delivered or click and collect for free. Also the rent for stores is ever increasing

  • Kranbone on 19/01/2020 - 00:34

    Many of the retailers who've closed have made several bad choices which have come back to haunt them.

    The market shifts and evolves and you need to support that.

  • CalmLemons on 19/01/2020 - 09:13
    • People are not spending money
    • Ozbargain community is a very small portion of the general spending populace
    • There is a big trend in online retail because this is the overall trend and the ability to adapt to any change is quite difficult.
    • Per sale marketing expense online is a lot more than mortar and bricks due to multi channel marketing e.g. influencers, google ads.
    • The retailers that are going bankrupt were slow to adapt and shit to begin with, as people spend less in Australia, there is less money to be departed to these guys.
    • Places like Myer have been slowly dying for 15 years as they now offer no strategic value (I started working there 15 years ago when it was at it's peak and could definitely reflect now that upper management, middle, team, in fact every single layer was the cause to it's gradual demise - too much politics and management layers - only thing good was more staff, of which there is none now - and now retail is a lot more transparent with a behaviour to check prices very easily. ) Consumer behaviours have changed and it's mainly to be able to search for prices easily online and this has become a habit for most users.
  • Stevecro on 19/01/2020 - 11:07
    +3

    I agree with most of the posts so far, and there a multiple factors for retail dying, however I think we truly underestimate the insane cost of commerical rent for smaller businesses. I have a few friends who own shops in various shopping centres, and the amount they are charged is astronomical! I was speaking with one of them who told me how much he is paying in rent, I didn't believe him.

    He showed me the invoices for the amount of rent he pays, I almost fell off my seat. Shopping centres are extremely greedy and make it very hard for smaller businesses to stay in business. Sure many other factors come into play, however when the majority of your sales income is used to simply pay your rent, it makes it very hard to make a decent profit to live off. In my local shopping centre, I constantly see boarded up spaces where if rent was reasonable, could easily be filled and stay filled.

  • Top G on 19/01/2020 - 12:32

    The only thing OzBargain has done is create a more dynamic competitive retail landscape in Australia. While the site isn't perfect I feel it has done more positive than negative on the whole. Retail sharks which complain otherwise must not understand how freedom of information works, and consumers informing each other might hurt them individually but empowers businesses with real value propositions.

    Only thing I don't like is lesser known stores getting too much OzBargain exposure, they get a rep for themselves, get organic sales and don't offer the same level of discount. But alas a new competitor takes their place and the cycle continues.

    The rise of online has led to the rise of discrete shadow marketing,but soon the review space will catch up and dodgy business pushing a bad deal will by exposed faster than ever.

  • bigbadboogieman on 19/01/2020 - 12:42

    The EB Games in my area closed shop. I was feeling upset but then I realised I haven't bought from them in a while.

    I blame incompetent management and their expectations of stupidly ridiculous profit margins. These are corporate "employees" who've never owned or operated a business in the field and are not close to the market to get an updated feel of it. There are good ones out there as well and consequently those businesses are flourishing.

    The ugly mindset is that if we can't make our magically generated stupidly ridiculous margins from a particular product then it's no use to sell/keep stock for that product. Soon enough the whole product line disappears and then there is no use to keep a store around. The only people these folk look out for is themselves.

    Customers will just find other ways and forget these businesses exist (because they closed shop in their area) and soon enough, it's voluntary administration. The sad part is that the only losers are the majority of retail people who lose their jobs in the process while these "corporates" just walk away with heavy pockets to find another business to ruin.

  • freemoneyhunter on 19/01/2020 - 17:01
    -1

    They should tax postage, I think postage is too cheap, sometimes it is free,

    • Cluster on 20/01/2020 - 01:23
      +1

      Postage is never free. It's built into the item's price. If however an item comes from China then the Chinese taxpayer picks up the tab.

      • curtturtle on 20/01/2020 - 07:47

        Not quite. Auspost picks up the cost once it is here and gets nothing from the original shipping cost.

  • MementoMori on 19/01/2020 - 17:13
    +2

    Yes I do.

    I've seen this play out several times:

    Step 1 - Big W - offers awesome price drop on PS4 game, and is posted on OzBargain. Receives hardly any upvotes.

    Step 2 - Amazon then price matches, heaps of upvotes and click throughs. People talk about the 'convenience' of having to wait 3-4 days for their game.

    Doesn't make any sense to me? Big W is obviously doing what it can to offer us a great deal, and are open until 9pm most nights/stores, but now they are closing down stores…

    I wonder how many people have seen what the US is like and how this all ends up? (https://www.google.com/search?q=wage+cage+9000&source=lnms&t…)

    P.S. Harris Scarf is closing too.

    • TEER3X on 20/01/2020 - 21:49
      -1

      Nobody likes leaving the house anymore bro. This isn't the 90s

  • morphio on 19/01/2020 - 18:39
    +1

    If anything, I actually spend more with OzBargain.

  • webtonmoy on 19/01/2020 - 20:07

    Today, I ordered some nappies from amazon for about 18.5 (apprx) delivered which goes for 30$ in all the major retailers (occasionally $25). Amazon obviously makes profit on this sale, so I wonder what is the margin for coles/chemistwarehouse/others…

  • syousef on 19/01/2020 - 21:56

    If you don't buy a buggy whip, you monster car driving person, you're contributing to the starvation of buggy whip makers everywhere! Think of the buggy whip makers!

  • Cluster on 20/01/2020 - 01:23
    +2

    Online shopping has been with us for two decades now. It's nothing new. To blame online shopping for the demise of legacy stores is not a realistic argument.

    What we have is too much debt. Too much money spent on stuff we didn't really need. Too much money piled into real estate. This leads into low wage growth. Lowering interest rates just motivates people to pay down mortgages faster as the only way for rates to go is up. The media tells us how terrible the economy is on a daily basis. That motivates people to spend even less.

    We have also seen a stagnation in new products. Remember when the iPhone came out in 2007 and people were lining up for weeks to get it? That lasted for the next 4 generations, but by the time iPhone 5 came out it was just an marginal improvement. Quick, name one 'must have' feature in the iPhone 11. $1.5k? Oh, slo-mo selfies!…. No thanks.

    How many 'I must have this NOW' products came out in 2019? I can't think of even one. VHS to DVD was a massive jump in quality. DVD to Blu-ray was very pleasant. But 1080p to 4k? One channel on foxtel, none in free to air. Manufacturers are pushing 8k already but it's all a big yawn really. No one is excited and running out to replace their TV like in the CRT era.

    Electric cars have the potential to spur a spending frenzy in the future as people ditch their legacy vehicles and spend on infrastructure. Only problem is most manufacturers are dragging their heals bringing affordable cars to market. Right now a $25k ICE car is the practical equivalent to a $50k EV. That just doesn't work for the vast majority of Australians.

  • curtturtle on 20/01/2020 - 07:46
    +1

    I have moved to buying most of my stuff online, not just because of convenience and price but because retail stores have forgotten their one strength, customer service. I would happily shop in store if stores gave a shit. If I am going to go to a store and get no help, attitude from the staff and no return option if there is a problem; I may as well buy online where I get no help but can return items that break.

    Stores have been half assing it for sometime and now it has caused them to fail. They can blame the internet, but the fault is solely their own. Old people shop at harvey norman because they get good service from staff members. I personally hate harvey norman, but I have seen them go above and beyond for mum, so of course she buys from them.

  • Typical16-bitEnjoyer on 20/01/2020 - 10:21
    +1

    Meh, what does around comes around. This is a highly complex issue, but essentially my key take from this is that the modus operandi of many big corps in previous decades was to obtain enormous amounts of finance, order in huge quantities and sell at incredibly low margins to run individual/family/SMB owners out of the retail game. They couldn't afford their rent, they closed, then the big corps raise their prices and continue to monopolise.

    The internet has given an avenue for smaller businesses to compete again without the overheads required.

    Now we have behemoths like ebay and Amazon becoming the new gen of middlemen, and what goes around will come around again.

    • FindMeADeal on 20/01/2020 - 10:25

      A different perspective indeed. Would be interesting to see how and what will shift the tide once again against the big internet shops/middlemen.

      • Typical16-bitEnjoyer on 20/01/2020 - 12:45

        Now that the majority of businesses, even retail, are online now I predict delivery speed will become the next market determiner. Why order from someone cheap online that'll take 2 weeks from HK when another seller offers guaranteed 2 day delivery, or a local business will drop off to your door guaranteed next day? This is how Amazon has continued to dominate in the USA the past decade against strong opposition.

        The market will adapt and change over time. As it has, and will always continue to do… until an apocalyptic event sends up back to the iron age.

  • netjock on 20/01/2020 - 16:10
    +1

    If you are here busy talking about it then you definitely contributing (if you are not out shopping) hahahaha

  • Zondor on 20/01/2020 - 17:19

    I go to brick and mortar stores because I want customer service or am unsure about my purchase. But when I go in, no one is interested or can help me. So I do the research myself and buy online, their failure is their inability to adapt with the times.

  • GrueHunter on 20/01/2020 - 20:58
    +1

    Once in a while I say 'you know what - let's just try the local stores and help out a small bricks and mortar business owner'. Today was such a day.

    I need a couple of downhill / full face bike helmets. I checked Google Maps for bike stores near me, and selected 99bikes and Pushys. I had a look at their websites, researched a few helmets, jotted down some notes, loaded the family into the car and drove to the local stores…

    …which turned out not to have anything in stock, and what they did have was priced much higher than online. 'Yeah, the Pushys online store is a separate business in Queensland.' That's great to know. It doesn't explain why I should pay you $139 for a helmet that's selling at your online store for $90, and the online store is also running a $25 off sale for January, and the online store actually has the sizes I need in stock. 99bikes was the same. Almost none of their online range in store. So I came home, ordered the two helmets for $49 less each, got another $25 off with the coupon, and now I'll sit back and wait for them to arrive in my parcel locker five minutes away and collect them at my leisure, rather than driving across town to look at your empty shelves.

    So hey, I tried. Pretty much every time I do - a book, a game, a movie, shoes, shirts - I end up disappointed and wind up going online anyway, where I have a seamless, fast, and pretty much always cheaper experience.

    I'm happy to pay a bit more for something I want. I'm not happy to pay a lot more for something I have to settle for because you don't have any stock. I reckon that's their problem, not mine.

  • thechemist on 20/01/2020 - 22:40
    +2

    As a bricks and mortar retailer (Talking from 2010 to 2020)
    1. Rent goes up CPI/3%
    2. Most retailers pay based on award so that's 3% each year as well
    3. Power prices have been going up at least 5% PA and same as insurance
    4. Most retailers sell commodotised products (pretty much anyone can sell the exact same product) with increased compeitition leading to lower prices and lower margins, lower sales
    5. E-commerce leads to more compeitition lower margins
    6. Increase compliance cost e.g. OHS
    7. All this leads to usually only 1 group to dominate the majority of space e.g. Officeworks, Bunnings and Chemist warehouse
    8. Suppliers support these dominant players as easier to deal with one group rather than many smaller ones (same with landlords)
    9. Other ancillary guys coming in and clip the ticket e.g. Afterpay and Uber eats
    10. General public behavior is getting worse with abuse on the increase (abusing retail staff seems to be a favourite past time of many)
    11. Shoplifting definite increase
    12. People like to say/think they support the local guy but at the end of the day their dollars go to wherever it's cheapest most convenient for themselves
    13. ozbargain does have an occasional Brick and mortar deal only but most are closing down sale or a clearance item where there is only 1 left as OP bought the other 10

    As a consumer
    1. More money spent on experiences and travel nowadays
    2. More money spent on subscriptions e.g. Netflix
    3. More money spent eating out
    4. Retailers haven't inspired me with a reason to upgrade/buy (they say most people are getting a new phone after 4 years as opposed to 2 which was common 10 years ago)
    5. Most targeted advertising (most effective kind) e.g. facebook get you to click to an online store (ads never say please go in to store and speak to someone)
    6. Retail staff don't know their stuff/can't find one/or is a 16 year old
    7. More money spent on kids education, those costs definitely go up way higher than CPI
    8. Too much crap already with house prices so high don't know where to store it (lets not talk about the size of an average mortgage)
    9. Retailers don't want you to go to their physical stores and run promotions for online only

    A lot more closing up soon, The one flagship store that tries to give you an experience or inspire you then push you online to buy will be getting more and more common as having too many physical sites unless you are a supermarket or a convenience play is not sustainable

    • FindMeADeal on 21/01/2020 - 09:04

      Loved the view from a retailer. This definitely makes it tough for small shops.

      Thank you for sharing!

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