An Observation - Retail and more...

Diddler82

Hello all,

I wanted to ask my fellow ex-pats if they have noticed this or is it just me!

I live in North Bondi and over the last 3 months I have noticed more and more shops along Campbell Parade closed down or there temporarily (maybe some are these Pop-Up stores) and gone again. I don’t often take the bus all the way into the city but I was on the 333 on Friday evening and I noticed the same thing in Paddington. Rows of shops, closed, closing down or up for lease.

The vast majority are overpriced retail outlets and I know full well that they would not have even lasted 5 mins in Celtic Tiger Ireland let alone now .. but it does worry me to see this happening. I was working in recruitment at home in early 07 when construction started slowing down ever so slowly, then after that retail took a hit and then we all know what happened after that!

Is this the same in other states? Not being an economist or trusting anything in the news .. so I come to the only source of information that I can trust - Boards.ie!

Do we need to be worried?!

Mellor

Niche and specialists store are losing out to online retailers.
Surf shops, diving shops, bicycle shops, MMA gear, Sports nutrition shops etc. The mark up these guys require to survive is pretty high and with online retail getting better and better they eventually fade away.

catbear

Mellor wrote: »

Niche and specialists store are losing out to online retailers.
Surf shops, diving shops, bicycle shops, MMA gear, Sports nutrition shops etc. The mark up these guys require to survive is pretty high and with online retail getting better and better they eventually fade away.

I read somewhere that on-line spending had dropped too. There were plenty of new retail units that have never been filled since i arrived in perth two years ago, reminded me of section 23 development retail units in ireland back 06.

Mellor

catbear wrote: »

I read somewhere that on-line spending had dropped too. There were plenty of new retail units that have never been filled since i arrived in perth two years ago, reminded me of section 23 development retail units in ireland back 06.

Spending rises and falls all the time. Online retail could easily be down too. But probably not to the same degree that would cause shop closures.
I've spoke to two shop owners recently (sports nutrition, and MMA/boxing equipment) and both have said its getting very hard to compete with online. Being a retailer alone isn't enough etc.

.Longshanks.

The online element explains IMO why the niche shops are going / gone.
However a thread I have spotted (that being back negative memories) is petrol stations closing down - and being redeveloped as apartment blocks.

Batgurl

Driving along Cleveland St in Sydney recently and couldn't get over the number of empty units that used to hold restaurants, cafés, bars etc. I dunno whether it's the location or the economy but this end of town is struggling.

rightyabe

noticed the same in Perth.

Fremantle E shed markets has a lot of empty shops that were there last year. I notice in various shopping centres that a new shop opens and when you go back in a few weeks its gone and a new store is coming soon to it. Also I notice stores that had a shop not in a shopping centre are now moving into the vacant shops in shopping centres.

I went to college in Letterkenny for 3 years and was always amazed at the rate that new shopping store units were being built when there was thousands and thousands of square metres for lease that were newly built that never had 1 tenant.

I have been comparing Letterkenny to Perth as past year almost and I now see it more often.

subpar

This has been on the cards for the last 18 months or so. All the signs were there to see but were ignored.

Those that lived through the celtic tiger should be familiar with the signs

Very High public sector spend and public sector employment growth funded by by a finite boom in mining exports and domestic spend. ( in irelands case property related taxes)

Rapid increase in property prices

Fast expansion in the retail sector and accompanying price rises and inflation

Low interest rates

Very High and still growing levels of private sector debt and borrowing

Salaries and wages escalating to chase the property and retail boom

Continued push in the media to talk up the property boom and reassure the punters that all is ok and that Aus is different to everywhere else

Vacant retail , commercial and private property

Growth in unemployment and increasing levels of redundancies

All the major banks very exposed to mortgage defaults and bad loans to developers

Poor or non existent political leadership.

So the party is coming to its inevitable end - it was good while it lasted - for some at least, but many irish who went out to Aus over the last few years will be caught up in this. Yes they did earn good money in Aus , but with the very high cost of living you need to be earning good money , so you will never make your fortune in Aus.

It hard to feel sorry for the native Australians , they saw what happened in europe but repeated the same mistakes and will reap the same barren harvest. The Australian authorities took advantage of the tens of thousands of well educated irish and others who went out to Aus over the last few years - making them pay through the nose for entry and working visas , sit and pay for english exams when it was the prime language, pay for high air fares , property rents and the general cost of living.

The irony is that Ireland is now in a better place and is coming out of its mess, lets hope the lessons are learned.But looking at what happened in Aus over the last few years you would not bet on it.

The Aussie

subpar wrote: »

The irony is that Ireland is now in a better place and is coming out of its mess.

If the unemployment figures were somewhat honest you would not be saying that, with shoddy Internships, waste of time courses and not to mention the saviour in immigration, come back and live for a while it's improving but to say its anywhere near being in a good place is highly disingenuous.

catbear

The Aussie wrote: »

If the unemployment figures were somewhat honest you would not be saying that, with shoddy Internships, waste of time courses and not to mention the saviour in immigration, come back and live for a while it's improving but to say its anywhere near being in a good place is highly disingenuous.

I think what that's highlighting is sustainable economic activity is growing. Ireland current high unemployment is a consequence of the credit fueled speculative economy that sucked in as much as 15%-21% of the workforce into construction/property and related services, far above whats normally required of a diversified economy.

it's classic cyclical boom and bust and Australia is a champion at it. Recently the main difference between Australia and Ireland is that while Australia hasn't gone mad building houses it has still waded into serious debt for existing property, hence TV shows like The Block. Another difference is that Australia had mining, what would have happened in Australia back in 08 if the Chinese hadn't ramped up capital spending?

Negative Gearing is as alluring to the australian wage slave as section 23 properties were in Ireland. Both have sucked people into property speculation, there's 1.7 million australian taxpayers using negative gearing according to the last ATO figure I read.

Irish banks lent to all kinds of unsustainable borrowing, I have friends who got 100% mortgages while on causal contracts etc....
Hey you didn't even need a job!

Highly ironic if the only acting job he got was for a bank that leant to an actor who can't get a job!

Is that any less reckless than ANZ bank lending into Chinese residents to buy property in australia? it's not even Chinese cash pumping up chinese purchases, it's australian debt that will fall on the aussie taxpayer in the end.

All I'm seeing is the same property debt orgy, all the Aussie banks have learned from elsewhere is that if you make society addicted to debt they'll sell their children's future to bail you out.

In Ireland first time buyers were targeted, they were a demographic goldmine. In Australia the demographic bulge was with the existing home owner with low debt. That's the banks target, "equity mate!".

The Aussie

If you want to see about serious debt and the penny dropping, keep an eye on second hand Bogan Toys like Jet Skis, pimped out 4x4's and the like.

Regarding Ireland and the bodgy live register numbers, it's almost laughed about over here because the only people who believe it are the Government as they wax lyrical, Don't get me wrong it's better than it was 2 years ago but it's so far from party time the drinks have not even been ordered yet.

Diddler82

The Aussie wrote: »

If you want to see about serious debt and the penny dropping, keep an eye on second hand Bogan Toys like Jet Skis, pimped out 4x4's and the like.

Regarding Ireland and the bodgy live register numbers, it's almost laughed about over here because the only people who believe it are the Government as they wax lyrical, Don't get me wrong it's better than it was 2 years ago but it's so far from party time the drinks have not even been ordered yet.

Ah yea the CUB's as they are more commonly known (Cashed up Bogans). However it's not just the Australians that are getting sucked in by this. I know too many Irish guys who work for Irish contractors who rely on larger contractors on Rail, Construction and Utilities jobs. These guys live in mansions in Silverwater, Baulkham Hills and the like. They drive a top of the range Ute or Jeep to work, the wife drives a 4x4 and they have a BMW as their weekend car. It all rings too familiar for me.

FernandoTorres

I definitely agree that private debt is soaring here and the property boom is not sustainable. I've heard numerous people telling me about these property investments that they seemed to know very little about but were happy to put large sums into. Crazy behaviour.

However, I also think those of us who have lived through the Celtic Tiger boom and bust are scarred now and think that every boom will come to as spectacular a crash as in Ireland. It's possible for a housing market to re-correct itself without the bottom falling out of the whole economy. The Australian economy is nowhere near as reliant on property as Ireland was.

You could say it's overly reliant on mining which it probably is but I think people talk about mining now as if the whole industry is going to collapse some day. New investment is slowing and yes, people are losing jobs but we all knew the boom couldn't last forever. The world still needs resources and Australia has enough to supply it for many decades to come. It's no longer a boom but I don't think that's such a bad thing.

Overall I'm far more confident about the economy here than at home despite what you may read in the news. I didn't come here to "make my fortune", I came here to not have to pay 52% on my earnings and have the arse torn out of me with other charges, levies, fees, none of which seem to go towards providing any services to the taxpayer anymore. I also came for the better weather and overall quality of life and I'm very happy with the decision!

You'd drive yourself mad worrying about what may or may not happen. Best thing you can do is be prepared for any outcome. Live within your means and don't get caught up in the hype.

HillFarmer

FernandoTorres wrote: »

I definitely agree that private debt is soaring here and the property boom is not sustainable. I've heard numerous people telling me about these property investments that they seemed to know very little about but were happy to put large sums into. Crazy behaviour.

However, I also think those of us who have lived through the Celtic Tiger boom and bust are scarred now and think that every boom will come to as spectacular a crash as in Ireland. It's possible for a housing market to re-correct itself without the bottom falling out of the whole economy. The Australian economy is nowhere near as reliant on property as Ireland was.

You could say it's overly reliant on mining which it probably is but I think people talk about mining now as if the whole industry is going to collapse some day. New investment is slowing and yes, people are losing jobs but we all knew the boom couldn't last forever. The world still needs resources and Australia has enough to supply it for many decades to come. It's no longer a boom but I don't think that's such a bad thing.

Overall I'm far more confident about the economy here than at home despite what you may read in the news. I didn't come here to "make my fortune", I came here to not have to pay 52% on my earnings and have the arse torn out of me with other charges, levies, fees, none of which seem to go towards providing any services to the taxpayer anymore. I also came for the better weather and overall quality of life and I'm very happy with the decision!

You'd drive yourself mad worrying about what may or may not happen. Best thing you can do is be prepared for any outcome. Live within your means and don't get caught up in the hype.

In my case my family and I have far more disposable income in comparison to home. I have worked in IT at home and Oz and there is unbelievable opportunity over here. Sure cost of living is high but you can still save compared to home.

Housing is definitely in a dangerous zone but I think demand over here from China in particular will keep prices stable.

CRenegade

Retail shops on Bridge Road, Melbourne have been closing one after the other.

I have always thought there was too much spending in oz and it does look like a reoccurring Ireland, or similar at least.

Who can afford to buy a decent house in a city in Oz these days? And I don't mean the hour drive in from the suburbs, prices are not matching income.

Tigerandahalf

It is interesting to see what is happening in Oz. When you look at wages they have increased way too much and are unsustainable. The big problem for Oz just like happened in Ireland is that wages are increasing to chase the cost of living. Loans given out as a result are higher. So similar to Ireland.
When a downturn comes how will the government sort out its budget deficit. It will have to, like Ireland, cut public wages and services and thus depress the economy further - the same austerity as in Ireland. Tourism in Oz is badly affected as high wages and the high Oz dollar are killing their sector.
The other choice they will have unlike Ireland is to devalue their currency. What effect that would have on their banks and their deposits is another question. Would the banks see a huge amount of deposit money leave and leave their balance sheet in a mess.
Another worry for Oz as mentioned above has to be the amount of loans given to people with no real connection to the country - Chinese, Irish, etc. What is to stop these people fleeing the country and leaving their debts behind them.

danotroy

Mellor wrote: »

Niche and specialists store are losing out to online retailers.

.Longshanks. wrote: »

The online element explains IMO why the niche shops are going / gone.
.

I would say the inverse is actually happening here in melbourne. Many Niche shops are popping up to furnish the high end/specialist end of the market. However the stores who have had it easy for years are really suffering from online retail. In the case of bike stores many of the high street retailers are really struggling to compete with online stores such as wiggle, who offer free postage from the U.K to Australia. In the meantime there has been massive growth in specialist bike stores who focus on a certain niche in the market. These stores whilst not immune from online shopping are in a better position than the generic stores on the high street.

CRenegade wrote: »

Retail shops on Bridge Road, Melbourne have been closing one after the other.

I would not consider Bridge road to be a fair yardstick to judge Melbourne on. Bridge road has high vacancies but that is not sue to lack of sending the spending has simply shifted. within a 3 km radius, not including the cbd there are at least 5 retail strips with better offerings. That plus the fact there is a massive shopping centre on the next street over, where some of the former bridge road retailers are now located

Mellor

danotroy wrote: »

I would say the inverse is actually happening here in melbourne. Many Niche shops are popping up to furnish the high end/specialist end of the market. However the stores who have had it easy for years are really suffering from online retail. In the case of bike stores many of the high street retailers are really struggling to compete with online stores such as wiggle, who offer free postage from the U.K to Australia. In the meantime there has been massive growth in specialist bike stores who focus on a certain niche in the market. These stores whilst not immune from online shopping are in a better position than the generic stores on the high street.

I think the issue here is the choice of words. You are refering to general and specialist withing bicycle stores. In my post I was refering to all bike stores are specialist (ditto for surf shops, sport nutrition etc).

So we're describing the same thing, sort of, the average store is struggling, the ones that offer a bit more are excelling. To be successful you can't just sell the goods, you need to provide a step beyond what is availible online.

danotroy

Mellor wrote: »

I think the issue here is the choice of words. You are refering to general and specialist withing bicycle stores. In my post I was refering to all bike stores are specialist (ditto for surf shops, sport nutrition etc).

So we're describing the same thing, sort of, the average store is struggling, the ones that offer a bit more are excelling. To be successful you can't just sell the goods, you need to provide a step beyond what is availible online.

Yes reading from the same chapter But i'm not just talking about bike stores. Specialist stores are opening up all around. Specialist books stores alla perimeter,
embiggen and metropolis ,to name a few, are thriving.

I think its more of a changing time we live in rather than retail slowing down. Any tom dick or harry can go online and purchase "insert inanimate object" rather than going down to a generic high street store. But specialist stores have an important and growing role to play in the retail sector rather than a one stores fits all approach of the old high street store.

Therefore I think the OP has hit upon a topic of debate but it I do not think panic buttons need to be pressed due to a few stores closing down.

Diddler82

danotroy wrote: »

Yes reading from the same chapter But i'm not just talking about bike stores. Specialist stores are opening up all around. Specialist books stores alla perimeter,
embiggen and metropolis ,to name a few, are thriving.

I think its more of a changing time we live in rather than retail slowing down. Any tom dick or harry can go online and purchase "insert inanimate object" rather than going down to a generic high street store. But specialist stores have an important and growing role to play in the retail sector rather than a one stores fits all approach of the old high street store.

Therefore I think the OP has hit upon a topic of debate but it I do not think panic buttons need to be pressed due to a few stores closing down.

I have to agree here on the specialists shops and their value. I have never purchased any footwear here in Australia (because it's a feckin rip-off) but with running the Sydney Marathon ahead of me I went into the ASICS store at Town Hall. They recorded me running and how my feet move, impact areas etc and then suggested 3 pairs of shoes based on my running style. What I liked about it was that I was presented with 3 pairs (all at different price ranges) and I was recommended the middle cost pair that would suit me best. In addition to this I got a free (and very nice) t-shirt also, they had a promo running if you spent over $250 you got the t-shirt (worth $50) but I spent $189. Still a lot of money but it was the service that was priceless - all up about 25mins of their time.

Okay granted ASICS are not a small independent outlet but you would not get that depth of Service in the monopoly that is Rebel. In addition Rebel were a lot more expensive for the same shoes.

What I am getting at I suppose is the personal touch is important and is what makes the difference.

catbear

Diddler82 wrote: »

if you spent over $250 you got the t-shirt (worth $50)

Retailers here would **** themselves if TKMaxx arrived!

Price is what you pay, value is what you get!

catbear

FernandoTorres wrote: »

Best thing you can do is be prepared for any outcome. Live within your means and don't get caught up in the hype.

Sound advice. I lived within my means and didn't buy into the irish property bubble yet i still got lumped with speculator debt via the bank bail-out. Similar thing can happen here. Spread your wealth.

catbear

As I'm fashion unconscious I didn't realise how limited shopping was in Australia, now I know what my wife was complaining about.

A very geographically dispersed and isolated retail environment, which modernised concurrently with the most likely sources of FDI [foreign direct investment], has not proven attractive to international retailers. Of the world’s 250 largest retailers, only 16 operate in Australia, of which 13 are foreign-owned firms.

Australia ranks 30th, trailing Qatar, Russia, Poland and Thailand, and is only just ahead of Hungary. Melbourne is our most international city at equal #61 with Bucharest, but behind Jeddah, Birmingham and Shenzen.

It would appear that it’s a case of the more adventurous retailers finally ticking us off their list.

http://theconversation.com/shopkeepers-of-the-world-unite-uniqlo-heading-to-australia-18814

jackbhoy

catbear wrote: »

As I'm fashion unconscious I didn't realise how limited shopping was in Australia, now I know what my wife was complaining about.

http://theconversation.com/shopkeepers-of-the-world-unite-uniqlo-heading-to-australia-18814

Not nessecesarily a bad thing imo. Every town in Ireland and high street in UK have same set of generic shops, mostly UK owned.

catbear

jackbhoy wrote: »

Not nessecesarily a bad thing imo. Every town in Ireland and high street in UK have same set of generic shops, mostly UK owned.

I guess it's not a concern If you don't have any personal taste, no sense of individuality and are hapy to be led.