What's new in retail?

by Mru Kodali on 14 July 2009

The last couple of weeks have seen some interesting developments in the retail sector. A few highlights include:

woolies-picknmixWoolworths, the brand that went into administration at the end of November has comeback to life online. The launch was quite successful with 20,000 visitors within the first few hours but the local convenience, which was one of Woolies USPs, is now lost with hundreds of competing e-tailers. In terms of the products on offer, the traditional household items have been shelved but their famous pick ‘n’ mix has survived. The pick ‘n’ mix (or click ‘n’ mix as some are calling it) is fun to play with but let’s see how popular it’ll be online.

Also in the past couple of weeks, Primark‘s sales figures were released and they’ve got a lot to shout about – a 20% increase in profits in the middle of a recession is no mean feat. Providing cheap and cheerful fashion, especially to a nation that values fashion highly clearly pays dividends (recent research shows that young Britons are less likely than their American or Australian counterparts to cut spending on fashion even in a recession). So much so that Primark is now expanding to at least 3 European countries. The question in my mind is ‘when will they start selling online?’ because the potential profits are huge.

And finally, across the pond, the ever popular e-tailer Amazon may not stay as competitive with its pricing – some states (and possibly the American Congress) might force it to levy sales tax on products (currently online-only companies are practically exempt from doing this). If this change goes ahead, it’ll eat into Amazon’s margins but result in a fairer playing field for e-tailers who have a bricks & mortar presence in the States. I wonder whether that’ll mean price rises straightaway or if Amazon will absorb some of the increases to start with to keep its competitive edge.

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