Regional BusinessRegional BusinessReviewReview
3rd Annual Business DinnerJames Hardie Dining Room
Charles Sturt University
Prepared by theWestern Research Institute
22nd March 2004
OutlineOutline
Regional Economy
National Retail Industry
Regional Retail Sector
Changes in Central West Retail
Key drivers and success factors
Retail Outlook
General Economic Outlook
National and RegionalNational and Regional
Source: Australian Bureau of Statistics
Australia Central
West
Economic Growth + 3.5% pa N/a
Unemployment 5.8% 5.1%
Population Growth + 1.2% pa + 0.1% pa
Sales PerformanceSales Performance
Source: Regional Business Survey sponsored by the Central Western Regional Development Board and Country Energy
-6
-4
-2
0
2
4
6
8
10
Net
Bal
ance
Regional ComparisonRegional Comparison
Source: Regional Business Survey sponsored by the Central Western Regional Development Board and Country Energy
-2
-1
0
1
2
3
4
5
CentralWest
Mid North Coast
Murray Murrumbidgee North Western
Northern SouthEastern
Net B
alanc
e
Sector ComparisonSector Comparison
Source: December quarter Regional Business Survey sponsored by the Central Western Regional Development Board and Country Energy
-3
-2
-1
0
1
2
3
4
5
Agriculture Business andProfessional Services
Tourism Manufacturing andMining
Retail
Net B
alan
ce
Significance of RetailSignificance of Retail
Australia Central West
Value Added $34 billion $325 million
Employment 1.3 million 10,300
Sources: ABS and WRI Input Output Table
Retail Employment ProfileRetail Employment Profile
Source: Retail Industry Profile prepared by the Australian Retailers Association
12% of Australian workforce60% female50% of all young people with a job work in retailTwo-thirds are casual / part-time25% of employment flow-on effects captured by retail
Retail Sales PerformanceRetail Sales Performance
Source: Regional Retail Survey sponsored by Reliance Credit Union
0.0
2.0
4.0
6.0
8.0
10.0
Mar-03 Jun-03 Sep-03 Dec-03
Regional ComparisonRegional Comparison
Source: Regional Retail Survey sponsored by Reliance Credit Union
0
2
4
6
8
10
Bathurst Blayney Cow ra Dubbo Forbes Lithgow Mudgee Orange Parkes Wellington
Net
Bal
ance
Sector ComparisonSector Comparison
Source: Regional Retail Survey sponsored by Reliance Credit Union
0
2
4
6
8
10
Clothing Food Hospitality Household Motoring OtherGoods
Recreational
Net
bal
ance
Retail Shift Share AnalysisRetail Shift Share Analysis
Source: Central West Shift-Share Analysis commissioned by the Central Western Regional Development Board
Analysed job growth 1996-2001Looking for sectors growing above state & industry averagesOutperforming retail sectors:
Specialised food + 23%Furniture & houseware + 71%Other Personal & household + 46%
Building ApprovalsBuilding Approvals
Source: Australian Bureau of Statistics
Change in value of Building Approvals(Four Quarter Moving Average)
-20.0%
-10.0%
0.0%
10.0%
20.0%
30.0%
40.0%
50.0%
60.0%
70.0%
Mar-99 Sep-99 Mar-00 Sep-00 Mar-01 Sep-01 Mar-02 Sep-02 Mar-03 Sep-03
Central West
NSW
Key Industry DriversKey Industry Drivers
Level of consumer confidenceRate of household formationLevel & changes in interest ratesPopulation growthEconomic growthHousehold disposable income
Source: IBISWorld
Key Success FactorsKey Success Factors
Good product offeringLoyal customer baseClear market positionSuperior after sales serviceAccess to latest technologiesEconomies of scaleProximity to key markets
Source: IBISWorld
Retail OutlookRetail Outlook
Retailer expectations slightly lower for March quarter of 2004Long run average sales + 4%MONASH + 1.8% in 2004-05Higher AUD increases demand for imported cars, electronics, etcIncreased competition for market share
Growth OutlookGrowth OutlookSector Central West
Share
Growth in 2004
Primary 21% + 9.4%
Secondary 18% - 0.9%
Tertiary 14% + 3.0%
Quaternary 29% + 3.4%
Quinary 6% + 4.2%
Total + 3.5%
Sources: Business Review Weekly State of the Nation 2004 and WRI Input-Output Table
General Economic OutlookGeneral Economic Outlook
Business expectations higher for March quarter of 2004Rebound in farm productionSlowdown in housing marketStrong domestic economyAUD forecasts 65.8c to 80c USPossibly higher interest ratesLow inflation in RBA 2-3% range
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