Keeping a Real World Shopfront is Tough at Westfields

Now it’s officially time to admit that Christmas is coming (not in October, when the decorations go up in the shops), I am doing the little bit of shopping I need to do in small stages. Today, I went to a shop that sells the type of things kids would like for Christmas in a large Westfield.  Such places are often held to be guides to our prosperity, our wealth.  You would think things would be fine in a Westfield – especially as they tend to suck in the bulk of shoppers in any regional centre / city in Australia.  I soon discovered, however, that they are not.

I picked up a present for my daughter – she is nearly 11 and I’m not trying to guess what she’d like.  We had been to this shop before and she pointed the item out as being a thing she’d like. Now I was buying it from the same shop – maybe not how things are done for some these days.  I like to buy things from shops, because the shop keepers can tell me something about it and I can take it back if necessary.

On this occasion, the shop’s owner, after telling me that it was a good unit, was unsure of the price. This was because, for the first time, he was having to discount his goods. Usually, he was telling me, he based his price on the original wholesale price, plus rent, plus wages.  Now, however, he was having to compete with online sales – someone in China selling the unit on ebay – usually an outlet that has disappeared the next day or week. As a result, he was having to reduce the price.

There would be some who would call this a triumph of neoliberalism, the free market, where greedy shopkeepers are forced to reduce prices because of the ever shrinking world and the ability to buy stuff online. The same people who stridently oppose any kind of GST on goods imported into Australia.

For this shopkeeper, however, it just means that he isn’t making any money from the exercise. What is cut off the price are his wages, because the rent to be in the Westfield is fairly high and nigh on impossible to change – unless you close down and open again, having negotiated a lower rental, or if you are up for a lease renewal.  The former is expensive and could cost goodwill, the latter can be a long waiting game, especially if business flattens out. There are shopkeepers, he was telling me that are shutting down, just to force Westfield’s hand.

Again, people could argue that such business are free to leave, to move to a premises with less rent. This is not a viable option in many regional centres, where Westfields or equivalent shopping centres are the only places where you can attract passing trade.

This loss of business – the worst seen by many – is the result of people going online to save a few dollars on discretionary items, rather than going to a shop that has a responsibility to follow through if something is wrong.  That is part of the reason why I was the only person to be buying something from him for the hour before my purchase.  He surmised that it’s probably a good thing that Westfield doesn’t seem to be too interested in building new shopping centres – the current ones seem to be struggling to hang onto all the current tenants, especially independent operators or people with a few outlets.

It was a rambling, fascinating conversation.  After I wished him well, a few things struck me.  Firstly, that last week’s absolute nonsense about the AWU and bagmen whatever has no relevance to anyone outside Canberra. None.  More importantly, it showed me just what today’s freedom of the market is doing – the dramatic impact that is being felt in the community. That this “boom” economy is for many people an illusion, something they hear about in the media, but are not experiencing.  It’s little wonder Tony Abbott likes to be seen in shopping centres – he’d be hearing stories like this all the time. About how things are tough. Not that he would ever have any ability or interest in doing anything about it.

Finally, it struck me that I know that people like buying online, they save money, they get precisely the colour they want, it saves having to brave crowds.  This is, however, affecting people trying to make a dollar by selling things they like to sell and mostly know something about. Places that are also trying to employ younger people wanting their first job in somewhere other than a McDonalds.  It is a reality that these places are sliding away, the world gets just a little more clinical, a little colder and that is a shame.