Written by Condon Associates on 7 January 2011

Happy New Year and welcome to 2011.  With the festive season over the year has had an interesting start with much press relating to the plight of the pub and retail industries.

With the major piece by the Daily Telegraph at the start of the week one could be a little confused as to what the driving force was, is it an industry in distress or is it a push by cashed up groups to make a move on potential “fire sale” opportunities.  I agree everyone loves a bargain, but for those involved in recovery the focus is meant to be the maximisation of a return and the preservation of value.  Needless to say this will not be achieved if everything is put on the market in one hit.  Let’s hope a more strategic approach can be adopted.

On the retail side there has been much over the Christmas period about the tax dodging internet purchasing and the damage that it wreaks.  In today’s Financial Review the underlying issue of the reality of a 10 percent increase in the overseas cost will not truly rectify a price gap of between 20 to 50 percent that is often achieved.   Retailers that are seeking to remain competitive will need to genuinely focus on costs and service.  Things like the cost of rent and other associated costs will potentially be a large part of the price they are trying to recover and if these are at uncompetitive levels then long term they are likely to lose.

Similarly, service must always be at the forefront.  In a discussion before Christmas a colleague lamented a situation where he sought to acquire a product (produced overseas) locally only to find that the local supplier did not stock the item and would have to order it in.  This then begged the question as to how any subsequent warranty style dealings would be dealt with and the response was that they would have to be directly referred to the overseas supplier.  Departing the retailers premises left the purchased completely bewildered why he would pay a significant mark up when there was absolutely no benefit achieved.

If you want to compete then be a genuine competitor not a “Mark-up Conman.”

PLEASE NOTE: All information contained in the articles below was correct at time of publishing.