RETAILERS MUST ADJUST TO ONLINE SHOPPING

Written on the 10 February 2011

RETAILERS MUST ADJUST TO ONLINE SHOPPING

DESPITE the Australian Retailers Association figures showing that sales were down 45 per cent compared to 2009, some Gold Coast retailers reported an increase over the period.

Harvey Norman Bundall franchisee Steve Cavalier would not weigh into the debate regarding Gerry Harvey’s comments about a GST for online shopping goods under $1000, but indicated that sales over the Christmas period were up on last year.

“Sales have been very good, definitely up on last year,” he says.

While Harvey and Cavalier are bracing for a buyer backlash as more consumers go shopping online, a newly formed coalition of retailer and wholesaler associations – the Fair Imports Alliance (FIA) is calling for an end to the big retailer campaign.

FIA has written to the members of the big retail coalition including chief executives and boards of directors of the various companies involved asking them to stop their campaign and instead focus on the Productivity Commission Inquiry into the Future of Retail.

Spokesperson Brad Kitschke says the big retailers’ media campaign is an unmitigated disaster.

“It’s a public relations nightmare. We warned them, we asked them not to go ahead with the campaign which actually doesn’t address the issue properly and is narrowly focused,” he says.

“The issue is broader than just the GST. It’s about custom duties, illicit trade and consumer protection. Consumers have rightly rejected this campaign by the big retailers. They have not done their research and they are asking the Government to implement a solution to a problem that goes well beyond the GST. They have just got it wrong.

“We have been working on this issue for a long time. Where was Gerry Harvey or Solomon Lew when we were fighting to have this issue addressed in July 2010 or for the five years before that? They have jumped on board at the last minute and have royally stuffed things up.”

Australian Retail Association executive director Russell Zimmerman agreed the way to fix issues with low value imports is to look at a broad spectrum of factors, not just the GST.

Zimmerman says consumers exercising their right to buy personal items from offshore websites is just part of the ‘new reality’ for retailers operating in a global retail environment. The real issue is about fixing loopholes in the system that allow imports on a much larger scale.

“Even if the GST threshold for imported goods was lowered or abolished tomorrow, it still wouldn’t solve the long-term issue of individuals and businesses rorting the system to the detriment of Australian retailers and wholesalers,” says Zimmerman.

“What requires serious government consideration is how our current regulatory environment allows misuse of the system by businesses importing numerous packages under the GST threshold over a significant period and then opening temporary pop-up stores or selling the goods on eBay GST free.”

The FIA comprises the following organisations: Australian Retailers Association (ARA), Australian Sporting Goods Association (ASGA), Bicycle Industries Australia (BIA), Australian Toy Association (ATA), Photo Marketing Association (PMA), Australian Fishing Trade Association (AFTA), Australian Booksellers Association (ABA), Australian Music Association (AMA) and the Retail Cycle Traders Australian (RCTA).

The bad news for the consumer led recovery is that ARA’s week-by-week tracking of retail trade during the Christmas period has found that the final week leading into Christmas Eve, more than 45 per cent of retailers were trading worse than the same time last year.


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