Institute for Social Change News

By Dr Louise Grimmer

The excitement of the opening of the new Myer store in Hobart is likely to last through into the new year.

It’s terrific news for local retailing that Myer has expressed confidence in the local market and committed to the state capital by unveiling a shiny new store in Liverpool St.

Department stores and large retailers in CBD areas are a magnet for enticing shoppers to the city, which is great for the local economy. What is better, for the economy and community, is when shoppers also spend at small, local and independent stores.

The historical rhetoric around small retailing is that small shops are doing it ‘tough’ and are under threat from national chains, discount stores and online retailers. For a long time, especially at Christmas, the plea from small business lobby groups has been for consumers to save small shops by avoiding their larger competitors or face the inevitable decline in choice when small stores are forced to close.

Consumers have previously been presented with the dire alternative that their “high street” will mirror those in other parts of the developed world, featuring only chain stores, discount outlets, banks and charity shops.

Perhaps surprisingly, and pleasingly, in Tasmania this is not the case. A recent study of small Tasmanian retailers, found the majority of small, independent traders do not perceive their trading environment to be tough or hostile. Positivity in the local retail industry is palpable, as is evidenced by the increasing number of small operators opening new stores in the CBD, suburban and outer-lying areas across the state.

This is no doubt a result of growing economic confidence as well as a reaction to what academics and cultural and economic commentators call “the Mona effect”.

Retailing is the second largest employer in Tasmania and the most recent figures from the ABS indicates almost 12 per cent of the working population is employed in the retail sector.

In 2014 the value of retail turnover in Tasmania was $465 million, and while it is difficult to break the down the statistics to reveal the number of small retail businesses in Tasmania, the Yellow Pages lists about 4000 businesses as retailers. While this figure includes all types of retail offering – large, small, chain, franchise, online and commission-based – it is evident retailing is a significant industry through the state and one that employs a large number of Tasmanians.

While small stores may not necessarily employee as many staff as the national chains, small operators support the local economy through stocking locally produced goods from local artisans and producers.

This trend is partly in response to consumer demand to buy local as well as a move away from mass-produced gifts, homewares, clothes and other items. It also allows small shops to manage their inventory in a cost-effective manner and keep transport costs down. In their own way, small retailers contribute to the growing culture of “making” and producing that is now thriving in Tasmania.

New entrants into the Tasmanian small retail market are not afraid to present sophisticated offerings, often in very small stores.

These sorts of niche boutiques have been operating in larger cities for centuries. Think of the small, delightful shopping arcades in Melbourne, London and Paris packed with quirky, erudite and often highly specialised shops.

Until very recently, these sorts of niche offerings did not survive in the long-term in Tasmania.

The rise of internet shopping rather than sounding the expected death-knell for small stores has actually opened new markets for many independent operators.

Instead of eschewing the internet as the enemy of their bricks and mortar stores, savvy small retailers have embraced the internet as a means to supplement their offerings, and as a means to attract and retain new customers.

Smaller shops are popping up all over Tasmania as retailers realise they can supplement a smaller floor space with an online inventory and promotion strategy.

While the advent of more shops means greater competition for small traders, it provides greater choice for consumers.

Stores that can capitalise on superior customer service, unique offerings and multichannel or omni-channel customer engagement strategies will survive and thrive in this new environment.

Tasmania is in the spotlight and local shopkeepers, entrepreneurs, producers and innovators are flourishing in the glow.

There is a significant retail revival happening across our island. This is something to be celebrated, supported and nurtured by us all.

Dr Louise Grimmer is an affiliated researcher with the Institute for the Study of Social Change at the University of Tasmania. Her special interest is retailing and communications/public relations.

This article was originally published in The Mercury on Saturday 12 December 2015.