The influx of global retailers into Australia will continue over the coming years, while international brands that have already set up shop here will expand into more cities, according to a new report from CBRE.
The research comes as worries spike over the grim outlook for bricks and mortar retailers. The boom in online shopping and Amazon’s entrance into the marketplace have piqued concern, coupled with low wage growth and more cautious consumer spending.
The outlook is driving retail landlords to spruce up their stores and offer more range and more competitive pricing, but according to the CBRE report from the real estate company, local retailers have been struggling to compete just on price and are being forced out of the best locations and spaces.
Australia does pose an attractive prospect to international retailers, with our healthy population and economic growth. “The sales productivity of new entrants has proven that Australians are eager for new retailers,” wrote CBRE’s senior research manager, Danny Lee.
According to Lee, Australia is ranking in the top performance countries for some of these global retailers who have already launched here. “The Australian stores of some international brands, for example, Zara and H&M Australia, (have realised) among the highest store sales performance in their global portfolio over the past three years.”
Since 2012, most international brands that have entered the Australian marketplace have come from Europe and most are fashion oriented. In the last 5 years, 44 global retailers have launched in Melbourne, 44 in Sydney and 19 in Brisbane, and this will increase over the next three to five years, according to the research, which says could take up over 1.2 million of retail real estate.
H&M recently announced that it would open regional stores in Townsville and Rockhampton as well as an online store that will back its physical presence here. Uniqlo, which already has an established online presence in Australia is also expected to expand its stores in the country. Last month the popular Japanese clothing brand indicated interest in opening a New Zealand outlet.