FMCG: Challenges in Australian Retail

Description

“Retail is being reshaped by the interplay between economic, social and technology, changing customer expectations and the emergence of new business models and channels” (National Australia Bank 2017).
In recent years, the global traditional bricks-and-mortar retail environment has been in the midst of a slump. Several factors are of influence, and when combined create significant challenges for retailers to face.
Australia’s retail sector is continually underperforming in comparison to the rest of the economy, influenced by factors including:
○ Changing consumer preferences, and a demand for experiences
○ International competition, leading to margin compression
○ Industry structural changes, due to increased online shopping; and
○ Decreased consumer spending due to low wage growth
(National Australia Bank 2017)
This report will address these key factors and explore the industry challenges.