According to newspaper reports e-Bay, Amazon, Alibaba and other major global e-commerce brands are threatening to geo-block Australian consumers from purchasing products on their websites if the Australian government introduces compulsory GST collection on all purchases – extending the application below the current AUD$1,000 threshold. If that is true and they are trying to use media pressure to force the government to back down on the application of a domestic tax policy that every Australian abides by, then I for one would be happy to be geo-blocked.
The last few months I have been confronted with several occasions that have demonstrated why not all retailers are equal. Moments where it is very clear what separates the real merchants from the ‘professional managers’. And every one of these moments has been about the decision making required to show leadership. I know it is fashionable and politically correct to support the notion that anyone can be taught how to be creative and lead. I personally think that is rubbish.
This week the government passed legislation to allow for tax cuts on profits made by businesses below $50 million in gross sales. Good news for those retailers who qualify – and make a profit. The stimulus the government believes this ‘extra cash’ will generate is great on paper. International businesses do not need lower tax rates here to sell here or invest here. The reality is that the government – and domestic tax-payers – would be far better off if they applied the current tax rules to all competitors equally – most notably international competitors.
It is true to say that online retail represents less than ten per cent of all retail sales. It is also true to say that Amazon represents a fraction of that ten per cent. But it is undeniable that Amazon’s impact is way beyond the sales it actually achieves. It is the ‘why’ that is the source of the opportunity not only minimise their impact on your business, but to beat them. After all, everything in retail is an outcome of competitive context.
Right here, right now. On my way to work or home. Handy. Just around the corner. In stock, always. 24/7 access. Click and deliver. Get it in my hands where and when I want it. Home delivered. Easy to find the cheapest price. Fast and efficient. Basically whatever I damn well demand – which is an ever evolving and completely changeable scope that happens to bend to my will at any point in time. So say the respondents in qualitative research discussions of shoppers.
If there are two things you can rely on in a wage case it is that there will always be two diametrically opposed points of view and that the government will do an appalling job at creating the right context for the outcome. Right now, retail and hospitality employers look really bad in the eyes of the labour pool. Not a good look for an industry with super high staff churn and difficulty in recruiting for non-traditional hours.