CEO Welcome

Welcome to the winter edition of your industry publication, the Independent Retailer. This edition is full of news about our industry and matters as members face on a day-today basis.

There are updates as to what we have done for members on matters of concern at state and federal government and regulatory levels.

As a family and private food, grocery, liquor, timber, and hardware business sector we are moving into very mirky economic and social waters.

The past 2 years of the Covid-19 pandemic has caused a world of uncertainty. Consumer and worker behaviours have changed for ever. Online shopping popularity has escalated, the GIG economy has now become the norm and with economic stimulus packages being implemented around the world, demand for food and consumer goods has never been more robust. This has caused many supply issues and cost increases owing to the shortage of labour (Covid absenteeism), pallet and container shortages and Diesel/AdBlue shortages.

We have seen an escalation in the war between the Ukraine and Russia causing massive shortages worldwide of energy resources (gas) and agricultural products (timber & grains) as the world cuts Russia off economically from trading. This further lessening in supply, and demand remaining high, has caused large increases in fuel and food prices, adding to high inflation rates.

Inflation has escalated to 7% plus from the normal levels of 2% that has been experienced over the past years. The Reserve Bank of Australia has increased the cash rate twice now with further interest rate increases yet to come to quell the risk of inflation growing too high, putting further cost and affordability pressures on businesses and homeowners around Australia.

From 1 July members will be required to pass on to staff the FWC decision to increase Award based wages (the GRIA) by 4.6% and minimum wages recipients by 5.2%. Our industry sector has seen the cost of labour rise by 19% in the past five years.

Further, there will an increase in the Superannuation Guarantee by 0.5% - from 10% to 10.5% from 1 July.

Of all the challenges that are facing our members, two that dominate are labour shortages and increased cost of doing business. Without appropriate levels of employment, members cannot stock shelves and serve customers and cannot hold shelf prices down much longer.

Small business margins cannot absorb any further unsustainable costs to do business, so members must increase shelf prices, risking being uncompetitive with the chains.

In May, the Labour party took over the reins of government, with many seats going to Independents (Teal) and the Greens. Australia now has the most diverse Parliament in its history including an increase in women’s representation presenting different opportunities and exciting times ahead.

Despite all the challenges that are set before us we are still very fortunate to be living in the “Lucky Country.”

Until next edition.

Good selling and take care.

Jos de Bruin Chief Executive Officer

Annual Wage review consult with Justice Iain Ross FWC 18 May 2022