In the new financial year Canberrans will be able to shop around the clock like never before. In Civic, shoppers will be able to slip into a 24/7 Australia Post super store at three in the morning, or midnight if they wish, to pick up goods purchased online.
The surge in online shopping in tech-savvy Canberra is but one aspect of an increasingly competitive retail market that is seeing the big players redrawing the shopping map as a thriftier population looks for the big bargain, likely at the expense of the capital's smaller retailers.
Shoppers are flocking to Canberra Airport's Majura Park precinct where US giant Costco has been joined by Big W and a super-sized Woolworths supermarket. Next month Woolworths will open its Masters hardware store as it finally takes on the Bunnings behemoth.
Elswhere, Westfield Woden is planning a major expansion, with Myer, after vacating the Tuggeranong Hyperdome, going in against David Jones. Down south Big W is taking Myer's spot. And in Gungahlin, Coles is expanding and diversifying its existing supermarket
Australia Post has nearly trebled its net profit thanks to the growth in online shopping and is scrambling to update its services. The Civic super store will open in Alinga Street at the end of August with parcel lockers for online shoppers who will be alerted by text and email each time their goods arrive.
Australia Post spokeswoman Sarah Gordon says since July last year the number of parcels handled in Canberra has grown by almost 13 per cent, but won't divulge the numbers. Most business comes from the boom in online shopping. Toll Express Fyshwick manager Shane Thompson says home deliveries have increased 100 per cent with noticeable rises in outlying Burra, Royalla and Captains Flat. He has three additional vans doing 60 deliveries each day.
Business information analyst IBISworld says shoppers have become more comfortable using online price comparison sites and buying from either domestic or international online retailers.
Despite this and gloomy forecasts such as this week's Delloite Access Economics report, bricks-and-mortar retailing continues to reward landlords who invest and add to Canberra's shop floor space. ACT Chamber of Commerce chief executive Chris Peters says retail rents in the territory are among the highest in Australia. If some one leaves a shop another is waiting to fill their place. '' I don't see rents going down, there's always one more shop to go in, even with major stores. There are national stores that aren't in Canberra because they can't get space here.''
Peters puts this down to Canberra's high average incomes which drive retail sales and consequently rents. Consultants helping the government plan for Tuggeranong Town Centre's growth say Tuggeranong's population has a relatively high income when compared with Australia as a whole and with Canberra/Queanbeyan. According to the 2006 Census median household weekly income for Tuggeranong was $1547, while for Canberra and Queanbeyan it is $1483, and for Australia $1207.
When Myer vacated two levels at the Hyperdome in March, Big W moved into the upper level and downstairs has been reconfigured to accommodate Harris Scarfe, JB Hi Fi and six other specialty retailers. The mall's marketing manager Joel Smith says the revamped centre will appeal to the district's demographic. ''We'll have all the value retailers, Big W, Kmart under the one roof. The higher-end department stores are becoming a bit of a thing of the past. It's leaning more towards the specialty retailers to provide the offering with things like high-end manchester.''
Towards the end of 2005 greenfield sites on the city's fringe became a battleground for retail space. A few days before Christmas that year Canberra Airport's owner Terry Snow hopped into his helicopter to lift a photographer over Majura Park. Bare ground below filled most of the photographer's frame but there was enough of a steel frame for a picture in The Canberra Times the following day to dispel suggestions Snow was about to abandon plans for a string of new discount shops. A week earlier he had lost a fierce bidding war for a seven hectare bulky goods site at Fyshwick which became Direct Factory Outlets.
Snow pushed on with the Brand Depot venture, predicting his DFO rival down the road in Fyshwick would struggle to survive after paying $39 million - double the market value - for the land and having to invest in ancillary facilities such as undercover car parking that would make a discount shop financially unviable. Brand Depot has since closed and receivers have placed DFO on the market.
No surprises there given the intervening global financial crisis. What is remarkable today is the sprawling shops at Majura Park, despite predictions back in 2005 of an over-supply of retailing space. Woolworths has built its biggest supermarket in Australia and opened Big W to compete with Costco's 13,000 square metre retail warehouse.
The rapidly growing precinct has specialty shops, bulk liquor and pet shops, a food court, service stations and fast-food outlets. Woolworths and Lowe's Masters, formed to compete with Coles-owned Bunnings in the $42 billion Australian home improvement sector will open next month with as much floor space as Costco.
Employing 180 people, Masters will stock 45,000 products. Peters says Woolworths and Costco will sell in big volumes. ''This is a destination shop, you don't drop in on the way home, you go there to do your shopping. Those two are serious players, they are here for the long term.''
Majura Park's retail space is capped at 60,000 square metres in an agreement with the ACT government (excluding bulky goods retail). A little over half that is now occupied. Airport managing director Stephen Byron won't comment on the territory's amount of retail space. He says Majura Park is a regional centre and draws from a broader region across the Southern Tablelands and South Coast.
The Shopping Centre Council of Australia, which represents the owners of big shopping centres and people who invest in them, is unimpressed with Majura Park. Executive director Milton Cockburn says it has become a town centre in an area never envisaged for such activity at a time when retail growth is at its lowest point in a decade. He says the hierarchy of town centres operates more rigidly in Canberra than any other city in Australia, and the new developments, coupled with retailing in Fyshwick, will suck the life out of other town centres.
''It's been an absurd situation where the Territory Plan has been thrown out the window and we've now got a significant retail and commercial focus operating at the airport.'' He says shoppers will be the winners from a hike in floor space in the short term, but everyone will lose in the long term when businesses close.
''We're not critical of the airport,'' says Cockburn. ''They found themselves with a lot of land which they did not need for aviation and have done what you would expect a commercial organisation to do. The failure has been when the airports were sold, that they ( the federal government) didn't do what has been done with every other development and devolve the planning authority to the local or regional council.''
Cockburn says even before Costco and the latest Woolworths store arrived Canberra had far more supermarket floor space per head of population than any other capital city in Australia. ''The end result of that will be we'll inevitably see the failure of some of those supermarkets and the failure among independents. IGAs will be substantially hit.''
Colliers International ACT chief executive Paul Powderly says it's too early to see any impacts from Majura Park's rapid rise. ''What will happen, there is only a certain amount of retail spend, people will gravitate to where they can get the best services in a central location and they'll desert the smaller centres. I think that's where the biggest rub's going to come. The local centres are the ones going to be under fire.''
Peters says there's a swing towards entertaining at home, away from entertaining in restaurants. Restaurants and retail in general are doing it tough but people are buying new ovens, new kitchens and doing more entertaining at home. Peters says retailers are looking for new way to re-invent themselves to win customers. He gives an example of Smiths Alternative Books in Civic opening a wine bar to encourage people to come in and browse.
''We'll continue to see businesses which will fail and close down and we have seen some happening already and there are more are to come. The most vulnerable are stand-alone stores without the strength of a franchise or support system. The big are getting bigger and specialty stores, while they do have a future, they won't disappear, but they have got to do things differently.''
Woolworths is closing Dick Smith stores across the country, including at Woden, which Peters remembers opening with strong sales. ''Time has passed it by and it has been taken over by the likes of JB Hi Fi, Good Guys and Harvey Normans, again a classic example of retailers having to keep evolving to survive. The days of the owner-manager in retailing, other than food management, are limited. You must ship in big quantities and have warranties to back that up and expertise.''
Westfield's $125 million upgrade of the Belconnen mall yielded a 5.5 per cent increase in annual sales of $478 million to December 2011. For the same period Westfield Woden generated sales of $416.6 million, a 1.2 per cent drop from the previous year. Myer is relocating to Westfield Woden which is negotiating the purchase of more land to expand on the north-eastern part of the centre over a taxi bay area and the Neptune Street carpark to the north of Bonner House.
This will enable the mall to add 30,000 square metres of retail including the new Myer department store, a discount department store, supermarket and fresh food stores, fashions stores and general retail. The work should be completed by 2014.
Woolworths and Costco won't have all the traffic heading to and from Gungahlin. Coles is opening a new super store at Gungahlin next month, doubling the amount of floor space at the existing supermarket to about 6600 square metres. Coles says the new store will surprise customers with a broader offering beyond food and groceries. Fashion clothing, kitchen appliances, homewares, toys and home entertainment will also be on sale. ''If you want help getting to the car, we're only too happy to carry your bags,'' says Coles Gungahlin store manager Sam Ilott.
The ACT government's supermarket competition policy to curb the dominance of Coles and Woolworths isn't slowing them down at all according to independent supermarkets. In submissions to a Select Committee on ACT supermarket policy the independents, which include IGAs and Supabarn, say the majors are exploiting the territory's planning processes to open bigger shops. Woolworths are moving into local centres as well and the convenience and service aspects which once gave smaller players an advantage are being taken away.