Deloitte: Australian retailers enter Christmas season with cautious optimism
Seven in 10 Australian retailers expect higher sales over the festive shopping season compared to last year, although just 42% expect a growth of more than 2%.
The firm has released its annual Deloitte Retailers’ Christmas Survey, which also found that 64% of participants believe that Amazon’s market entry will negatively impact the retail space as a whole. However, paradoxically, 40% believe it will have a positive influence on their business.
David White, National leader of Deloitte’s Retail, Wholesale & Distribution Group, said: “A number of retailers haven’t survived the year and there is a concern amongst respondents that weakness may continue throughout Christmas 2017.
“With so many new and expanding competitors in the market combined with price deflation and rising electricity costs, it will be a challenge for retailers in the apparel, footwear and department store sectors to maintain margins over Christmas in the face of these headwinds. Food and grocery may find the going easier with price inflation providing a boost to margins.”
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Despite, or perhaps because of the nervousness around sales, retailers are holding steady on margins - 43% expect to see an increase in margins compared to 48% in 2016.
The impact of digital is also emphasised heavily by Deloitte. The online share of sales has consistently increased in every survey since 2012, and 2017 is no different.
The number of retailers expecting online sales above 6% has increased from 36% to 52%, with 31% of those respondents (versus 14% in 2016) believing their online sales will be more than 10% of their total sales for the period.
White continued: “We see the market waking up to the digital tipping point, where digital becomes not just a complementary sales channel, but the core of the experience. Retailers are embracing true omnichannel, with the reinvention of the store experience, consolidation of store networks and shifting of large portions of sales onto digital storefronts.”
And what of Amazon? The feedback on the US ecommerce giant’s arrival has been mixed, with 33% saying it will negatively impact their business compared to 40% which believe it will bring benefits.
“Amazon presents both a challenge and an opportunity for local operators,” White added. “Overseas, its domination of online retail has forced many retailers to adapt and find innovative ways to connect and build two-way communication with customers. The Australian market is not isolated; retailers have been quietly innovating as the competition heats up locally.”
DBS Bank expands digital trade finance on Contour platform
DBS Bank has boosted its digitalisation extending its offerings on trade finance network Contour to corporate customers in four key Asia-Pacific markets – Australia, China, Hong Kong and Singapore.
Singapore-based DBS was the first bank to sign up to Contour’s beta network and completed the first fully digital Letter of Credit (LC) transaction on Contour last year. The bank has moved to Contour’s production network to offer streamlined digital LC transactions for customers, to help digitise global trade.
Contour’s network focuses on digitising paper-based trade finance processes which can be expensive and time-consuming.
APAC is seen as a key region for digitisation of trade finance as banks and corporates seek to mitigate risk and enhance cost efficiency, including moving away from traditional paper-based LC processes.
Via Contour, which is also based in Singapore, DBS will be able to provide a fully digital end-to-end LC settlement process for customers in Australia, China, Hong Kong and Singapore, including the transfer of electronic trade and title documents – increasing efficiency in the process by up to 90%.
Digitised trade finance builds resilient ecosystem
“Our partnership with Contour aligns with DBS’ ongoing efforts to drive greater efficiencies in trade and unlock strategic value for our corporate customers,” said Sriram Muthukrishnan, Group Head of Trade Product Management, DBS Bank.
“We recognise that digitisation is a powerful enabler to simplify the highly complex nature of trade finance, especially for processes relating to letters of credit. Digitising trade processes is also an increasingly relevant and heightened priority for corporates to survive and thrive in the new normal and will form an integral component for resilient trade ecosystems of the future.”
Contour’s decentralised network increases security as it validates all identities and leverages technology partners to match trade documents to real-time data. Contour also offers a sustainable way for companies to reduce their carbon footprint.
“The addition of another major Asian bank to our production network highlights Contour’s growing presence in APAC as an industry standard for digitising trade finance documentation,” said Carl Wegner, CEO at Contour.
“DBS has been an important partner for Contour in our work to support Singapore’s position as a key trading hub and has already participated in a number of successful transactions on our network. We’re delighted to facilitate its transition to offering live services to customers in these four markets. This is another important step on our journey to becoming the new digital end-to-end infrastructure for global trade.”