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The death of traditional bricks and mortar retail?

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greggles

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I recently came across this Business Insider article on the death of traditional retail: https://www.businessinsider.com.au/...eath-of-retail-as-we-know-it-2017-5?r=US&IR=T

Given the rise of online retailing in recent years and the increasing tendency of some manufacturers to market directly to consumers (e.g. Tesla), is traditional bricks and mortar retailing on the way out? High overheads, increasing competition, the inconvenience factor are just some of the negatives weighing down on traditional bricks and mortar retailers. I don't go out to shopping centres much anymore and do most of my shopping online, with the exception of grocery shopping.

Do others think traditional bricks and mortar retailers will be good shorts in the coming years? Where is retailing heading as the internet continues to develop and mature? Anyone care to speculate? How will people buy things in five years from now? 20 years?

I have attached a number of three year charts to this post to illustrate the apparent weakness of bricks and mortar retailers and shopping centre operators.

MYR - Myer Holdings Limited


TRS - The Reject Shop Limited


HVN - Harvey Norman Holdings Ltd


RCG - RCG Corporation Limited


WFD - Westfield Corporation


SCG - Scentre Group
 
I think there will always be some role for traditional retail for those things where people want it there and then. Nobody's going to order a can of Coke online and expect it delivered by lunchtime when they walk past shops selling it every day.

For anything even remotely specialised however traditional retail just can't compete. Go online and you can get parts for a 20 year old brush cutter no worries. Walk into any physical store and you've got no chance unless it's a brand like Stihl with dealers as such or you just want some generic brand trimmer line from Bunnings and nothing else. Much the same with any other product, that's just an example.

I was in Woolworths a couple of days ago and I think they're trying to drive customers away. Whoever thought it was a good idea to have a supermarket sounding like a nightclub both in music style and volume didn't put a lot of thought into that one. Those who spend significant time and $ in supermarkets generally aren't the same people who go clubbing every week and I'd be surprised if more than 1 in 20 people in the shop could have named the DJ playing. Either stick to mainstream music, people are there to shop after all it's not an entertainment venue, or at least turn the volume down to something that doesn't require a raised voice to be heard over.
 
Great post Smurf. I agree that traditional bricks and mortar retailing will probably always have a place, but I think that this will probably diminish over time. Amazon have started delivering packages by drones in the US with customers supposedly receiving their orders within 30 minutes. Technology is advancing at an incredible rate and the retailing landscape is evolving along with it. I think this sector is going to see a lot of radical change in the years to come and a lot of opportunity as well, as the innovators start to shape the future of retailing.
 
Published today: Amazon's assault on the mall has killed a US book chain


The decline of bricks and mortar retailing appears to be largely a demographic issue.
 
basilio said:
Its not Oz but I wonder what is happening with our shopping centres ? All we have heard for months is failure after failure of retails chains. So clearly there will be a lot of empty shops.
Click to expand...
Our shopping centres shouldn't be anywhere near to being as threatened as the US malls. America had massive tax incentive structures back in the 80s where developers almost got paid to create new malls. Hence, they are way over supplied. That never happened here. But more generally to your point, so much of our spending is going online. You'd have to think that our shopping centres will suffer.

I can see a directional shift on malls though. We now have a dentist and a GP clinic in our local mall. So they're starting to become community service centres along with regular retail. I see that as a good thing. There's also Medicare/Centrelink. You can have your car serviced at our shopping centre. It's becoming a little city.
 
A lot are going to end up with residential towers on them. Probably even a buy to let setup by the owner (they will own them all)

Places like Chadstone, Highpoint, Southland could easily get 300-400 apartments on them
 
Toyota Lexcen said:
A lot are going to end up with residential towers on them. Probably even a buy to let setup by the owner (they will own them all)

Places like Chadstone, Highpoint, Southland could easily get 300-400 apartments on them
Click to expand...
Does the mall / shopping centre stay? Or more to the point are some of the open air parking and/or a sector of the shopping centre being converted to residential high rise?
 
I like the idea of combining the different services and retail. On the larger centres have a transport hub included with a STRONG local service. Along with this add a residential component. Submerge the carparks to underground and have open air sports/parkland and less of open air CAR-park land.
I could imagine some retail would have a greater warehousing component included for the local internet purchaser, albeit it would need to be efficient and cost competitive against imports.
 
Sections of the center would be utilized. You have Myer, David Jones, BigW and others that could go.

Not much involved in building over 3-4 level structure
 
Harris Scarfe, Jeans West, Ed Harry, Marcs, Pumpkin Patch, Payless Shoes, Roger David..(struggling) Myer. Toys R Us, Max Brenner, Laura Ashley, Esprit, Avon, Gap, Maggie T..your neighbourhood bookstore and hardware store.

It's a jungle out there. Some of it is just industry aggregation, but that my only be a halfway house, as eBay/Amazon/Paypal gain increased traction.

"Whoever thought it was a good idea to have a supermarket sounding like a nightclub both in music style and volume...Smurf" - So agree. Who needs that racket, when you just want a loaf of bread and a litre of milk on the way home
 
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