Analysis of Retail Market Essay

Larger businesses in sell are gener all toldy to a greater extent profitable than small businesses with many of the largest businesses historically among the approximately profitable in the econo(prenominal)y. The larger retailers in Australia would appear to have enjoyed better returns on chapiter than their overseas counterparts and have continued to do so since the global pecuniary crisis. Growth in retail sales has been slow in juvenile years. While short term or cyclical factors have contributed to this meanwhile, the harvest-feast of retail sales has experienced a long term slowdown due to changes in consumer buying habits.Consumers are choosing to spend a smaller share of their income on retail goods because over the recent past, they are saving(a) more and they are spending greater shares of their expenditure on go such as finance, rent and education. Further, while there has been price deflation in some sub-categories of retail, overall, sales volumes have continue d to grow. The level of productivity in the Australian retail industry is low compared to retail in otherwise countries in Europe and North America. However, the growth rate of productivity in retail, over the past two decades, has been similar to the average rate for all industries in Australia.Retailers have achieved productivity growth by increasing the roof intensity of their operations, including through adopting information and communications technology. Furthermore, investments in big box retailing have also been a factor. These changes occurred earlier in the US, and since then, US retailers have continued to achieve productivity growth by better management and operations to make more effective use of delve and capital. These opportunities appear yet to be fully realised by most Australian retailers.A snapshot of the retail industry Retailing makes a significant contribution to the economy The retail industry is one of Australias largest employers. Currently, there are almost 140 000 retail businesses employing about 1. 2 million people or 10. 7 per cent of the total running(a) population. Together, retail workers earn about $32 billion in payment and salaries each year, or 6 per cent of the economys total. The retail industry also makes a significant contribution to economic output, bring $55 billion or over 4 per cent of gross domestic product each year.However, it is a relatively small contributor to investment (table 3. 1). control board 3. 1 The contribution of Australian retail plenty 2009-10a Retail trade Gross value added ($m) Employment (000s) Wages and salaries ($m) Investment ($m) Capital stemma ($m) Number of businesses (end 2008-09) a Includes motor vehicles & parts and fuel retailing. Source ABS (Australian organisation of National Accounts gross fixed capital formation and capital stock, Cat. no. 5204. 0 Labour Force, Australia, Cat. no. 6291. 0, Counts of Australian Businesses, Cat. no. 8165. 0).