How Retail Businesses Are Surviving in the Online Market
In Australia, there has been a shift in household spending from retail, which has been exacerbated by rising prices of health, education, and utilities. The first quarter of 2019, as well as the year-on-year comparison, reflects the lowest growth in real retail sales for a long time, and has led to more retailers struggling to stay afloat.
In the first three quarters of 2019, 16 major brands have filed for bankruptcy in the USA. This includes iconic brands such as Forever 21, Diesel USA, and Barneys New York.
An increase in online sales
However, in the same vein, online sales are becoming more and more prevalent. According to Australia Post, in 2018 alone the number of online purchases grew by more than 13% year on year in every state and territory, with the national average growing more than 20%. 78% of Australian households shopped online.
The increase in e-commerce sales is largely due to the popularity of sales events such as Afterpay Day or Click Frenzy, online marketplaces such as The Iconic and buy now, pay later payment options such as Afterpay or Zip Pay.
Adapting to survive
What does this mean for you and your business? Businesses of any size can take advantage of Software as a Service (SaaS) solutions such as Shopify (and relatively cheaply depending on how advanced they want to be) and sell their products online. In an ever-changing world where it is becoming truer that any product is available to buy online, traditional bricks and mortar stores that cannot adapt are dying.
How can we help your retail business?
At Marin Accountants we are experts in helping small to medium retail businesses navigate the minefield that is the current retail market. By helping implement accounting systems and then tracking actual performance vs budget, we provide our clients with up-to-date information that will help business owners make decisions and implement the appropriate adjustments that they require to be successful.
Also, as we are part of the NORA Network, we can connect our clients with quality service providers for other parts of their business. This includes digital agencies, payment providers, FX providers, fulfillment providers, and much more.
We are proud of our association with the NORA Network, especially as we have now won the 2018 and 2019 award for Best Accounting Firm for Retailers.