Check out the latest blog post from CEO of Retailworld Resourcing Group, John Caldwell
The Australian retail market has matured significantly in recent years and is truly on par with other international retail markets.. We have seen an influx of international brands into the Australian marketplace and the introduction of larger format stores and true big box retail with brands like Costco and Apple aggressively opening stores in the Australian market We have also seen amazing transformations in areas such has home brand development and supply chain enhancements to rival the product offers in other countries however often this has been through the help of expats trained for years in this type of sophisticated retail.
Whilst we have become a serious global player it has happened quickly thus not allowing us to train a lot of senior professionals, who previously have relatively low experience in how to run these mega businesses. It is for this reason that we have seen some come to our shores and remain stagnant and others come and fail.
We have long relied on bringing in senior talent to show us the way, with candidates from more sophisticated retail markets like South Africa, UK and the USA however in recent times the funnel has narrowed and the influx of talent have stopped finding us so desirable. This may seem odd to some as Melbourne was just nominated most liveable city in the world with Sydney, Perth and Adelaide all in the top 10.
The problem isn’t the desirability it’s the economic issues facing us, starting with globally out of whack tax rates which act as a disincentive for top talent, many of these executives can secure well paid employment with very generous tax benefits in other emerging retail markets. On top of this the cost of living in Australia’s has also risen to catapult us to the top of those charts with Melbourne and Sydney ranking 6th and 7th most expensive cities in the world respectively. Melbourne ranked 40% higher than New York based largely on housing costs.
The consumer price index (CPI) showed a 19% increase in 2009-2010 highlighting the real increase in the cost of living in Australia, the trouble is that the average wage only increased by 3.8% for the same period leaving the average income earner to struggle with meeting daily household expenses. It is figures like this that are turning talented retail expats away from Australia in droves at a time when we need the talent more than ever. When we look at some of our failed retailers of late such as Borders, Colorado etc the problem was not the brands or the concepts it was the infrastructure in running them and the knowledge of how and when to turn them around. If we had the right talent with depth of experience behind them we may not have seen some of the recent catastrophes.
You may ask if this is the case then why is our immigrant population growing ? Yes it is! In fact numbers are on the rise in 2009-2010 208,000 people migrated to Australia and in 2010-2011 213,000 people came so obviously we are still an attractive country to some. The majority of immigrants in the 2010-11 period were from Southeast Asia, Northeast Asia, Southern Asia followed by New Zealand ,however the concerning trend is the increase in these people not in employment, this rose from 2.0% in 2008-9 to 2.7% in 2010-11.
This begs the question are we attracting the right people ??? That’s something you can answer for yourself but It is becoming more and more obvious that when it comes to attracting top talent to drive our economy forward it is getting harder and they no longer seem to think we are the lucky country.
For more blog’s by John Caldwell please see www.itsallaboutretail.com