Retail Management Report: Comparative Analysis of Australia and Nepal

This report provides a comprehensive analysis of retail management, focusing on the comparison between the Australian and Nepalese retail sectors. It begins with an executive summary highlighting key aspects of the retail industry, including the impact of digitalization and the economic contributions of both countries. The report then delves into the structural differences between the two sectors, examining their GDP contributions, market dynamics, and profitability. It explores the potential size and profitability of each market, along with the challenges faced by retailers in both regions, such as changing consumer preferences, convenient collection issues, and the impact of industrial relation laws in Australia. Furthermore, the report investigates the cultural aspects affecting retailing in Australia and Nepal, providing a well-rounded view of the industry. The report concludes by summarizing the key findings and offering insights into the future of retail management in these two distinct markets. The report uses data from 2017-2019 and also uses data from 2018.

Running head: RETAIL MANAGEMENT
RETAIL MANAGEMENT
Name of the Student:
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Executive Summary
Retail management is the development which allows clienteles to obtain the expected
commodities from the retail provisions for their finale use. Retailers of late are facing rapid
changes in their segments from dealing physical stores which are no longer important to the way
digitisation can result in re-employment as well as re-deployment of employees. The Australian
retail industry is recognised as one of the most imperative companies, thus deviations to
employment within it shows lesser inclination of affecting considerable number of employees
over the potential years. Australia's Retail Sales augmented around 3.7 % Y-o-Y in 2018,
compared with a 3.7 % upsurge in the former year. Conversely, Nepal is recognized as
prosperous market with substantial growth opportunities. Nepal retail sector is growing by
around 15% which is higher than international growth rate averaging around 2-3% (Price 2016).
But Nepal is yet to attain the position which Australia has already attained. The report has
evaluated possible size and profitability of retail industry, potential issues facing the retail
industry and cultural aspects affecting retailing in Nepal & Australia.

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Table of Contents
Introduction......................................................................................................................................3
Discussion........................................................................................................................................3
Structural Difference between Australian and Nepalese Retail Sector.......................................3
Australian Retail Making Major Contribution to its economy....................................................3
Australian Retail industry share of GDP and service is falling...................................................4
Potential size and profitability of Australian Retail Sector.........................................................5
Potential size and profitability of Australian Retail Sector.........................................................6
Potential size and profitability of Retail Sector of Nepal............................................................7
Challenges Faced by Australian and Nepalese retailers..............................................................7
Industrial relation laws posing threats to Australian retailers.....................................................9
Cultural aspects affecting retailing in Australia and Nepal.......................................................10
Conclusion.....................................................................................................................................12
References......................................................................................................................................13

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Introduction
Retail management is known as the process which enables customers to procure the
expected merchandise from the retail stores for their end use. Retailers recently are encountering
rapid changes in their sectors from managing physical stores which are no longer essential to the
way digitisation can result in re-employment and re-deployment of employees (Chernev and
Hamilton 2018). The Australian retail industry is recognised as one of the major employers, thus
changes to employment within it shows lesser propensity of affecting substantial number of
employees over the prospective years. Australia's Retail Sales increased around 3.7 % Y-o-Y in
2018, compared with a 3.7 % increase in the previous year. Australian retail sector is segmented
based on product category, supply network and market dynamics. Furthermore, Australian retail
sector registered an increase rate of 5%, 3%, and 2.6% in New South Wales, Victoria as well as
South Australia (Bayly, Scollo and Wakefield 2015). On the other hand, Nepal is recognized as
thriving market with substantial growth opportunities. Nepal retail sector is growing by around
15% which is higher than international growth rate averaging around 2-3% (Price 2016). The
report will evaluate potential size and profitability of retail industry, potential issues facing the
retail industry and cultural aspects affecting retailing in Nepal & Australia.
Discussion
Structural Difference between Australian and Nepalese Retail Sector
Australian Retail Making Major Contribution to its economy
The Australian retail sector is identified as one of the major employers staffing nearly 2.2
million of working populace in 2017-2019. The market law which directly impacts on market

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rivalry in Australian retail industry is the Competition and Consumer Act 2010. According to
Jose et al. (2016), the Act is enforced by the competition regulator known as the Australian
Competition and Consumer Commission (ACCC). As pert reports, ACCC applies numerous
procedures to evaluate the level of industry concentration specifically focusing on the proportion
of production of the four major firms or the CR4 ratio. This procedure is effectual in determining
of any specific market structure is probable to increase competition issues, while it is suggestive
rather than decisive of the capability of a business to exercise market power (Torok et al. 2019).
Australian Retail industry share of GDP and service is falling
Australia’s economy is declining to its slowest pace since 2009, when the Global
Financial Crisis stopped the constraint on its share of GDP. As per reports, GDP increased by
0.5% in June, 2019 which is seen as the worst annual growth in the aftermath of global monetary
crisis. The latest economist predictions for GDP range between 1.1-1.6pc growths over the past
year. Meanwhile, reports claim while the economy as a whole is trying to maintain stability, the
individual involvement of the economy especially at the household level has depreciated
distinctly over the past five years. Furthermore, Australia’s export sector is recently under facing
threats from global economy encountering several obstacles particularly the US-China trade war
and Brexit.
At the same time, Australia’s retail jobs which presently engage around 1.2 million
Australians have declined to only 59,000 since 2017. Such a decline has been related to severe
competition resulting in margin erosion along with lower profitability at number of firms
(Nayeem and Casidy 2015).
Nepal Retail Distribution & Contribution to GDP growth

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In comparison to Australian retail, majority of local and global manufacturers and sellers
distribute their products via traditional three-fold delivery system namely, company to distributor
or trader to retailer. Majority of the U.S. exporters sell via Nepal-based transitional like trading
business, local manager or distributor.
Furthermore, Nepal’s economy is likely to upsurge till 6 percent in the present financial
year, since in contrast to Australian retail, there is likely to witness strong growth especially in
retail sector. Additionally, services are predictable to grow at an average rate of around 6.3% per
year by 2020. However, stable payment inflows will upkeep growth in retail as well as wholesale
trade (Rajbhandari and Intravisit 2019).
Potential size and profitability of Australian Retail Sector
The Australian retail sector has experienced a positive growth, regardless of the
substantially low upsurge in wages and upsurge in domestic debt. As per the Australian Bureau
of Statistics (ABS), Australian retail turnover has declined around 0.1% in seasonally-adjusted
terms, which is estimated to be considerably lower than 0.2% increase predictable by financial
markets. Moreover, reports mention that independent retailers are ranked amongst the best
performers with an average sale of around AUD $504,979.85 yearly in comparison to New
Zealand and the U.K generating $495,360 and $487,355 respectively. The potential size of
Australian retail from 2017 to 2022 has been estimated to be around $556 billion with nearly
187,055 businesses executing their businesses within that sector (Sharma, Mishra and Kaplan
2017). Moreover, starting from fashion and footwear to furniture and electronics, it has been
noted that small retailers within the Australian retail sector are making considerably more on
each sale in comparison to majority of the other international markets.

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Potential size and profitability of Australian Retail Sector
Source: (Sharma, Mishra and Kaplan 2017)
The average business value stands at around $81.15, which is considered as a decent 14%
rise as compared to $71.39 that is the mean value worldwide. However, reports claim that real
retail turnover rate is likely to upsurge from 1.3% in 2018-2019 to 2.2% as Australians receive
their taxation returns along with expansionary financial started to be effectual. Furthermore,
innovative technology as well as efficient logistics is likely to recover the path for cross-border
e-commerce in Australia. Such a strategy will aid Australia in the entry of global participants in
the Australian advertise further assist Australian merchants to expand their networks into
international markets. Moreover, Australian retailers are targeting China and South Korea as the
Asian e-commerce market has attained around S$ 1.8 trillion by 2018 (Ayers and Odegaard
2017).

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Potential size and profitability of Retail Sector of Nepal
The Nepalese retail sector is showing strong assurances to marketers and retailers in
comparison to several other South Asian cities of similar size. According to Ayandibu and
Houghton 2017), although Nepaleses have relatively lower wages as compared to Australia, they
tend to spend substantially on apparels and consumables at par with Australia. Additionally,
success of international brands along with launch of new retail outlets expanding in Kumaripati
and Sherpa Mall have promoted Nepalese retail sector as a well-organised one. On the other
hand, Bishal Bazar Supermarket has facilitated Nepaleses to be exposed to global shopping
experience. Such an elevated retail performance of Nepal retail has led international brands to be
well contented and ability to replicate foreign styles. Furthermore, Bishal Bazar Supermarket is
likely to become must-visit desirability for local tourists besides city-dwellers. Meanwhile,
reports claimed that Nepal retail sector might encounter challenges in future profitability
primarily due to logistics and payment (Ayers and Odegaard 2017). Since few e-commerce
websites have warehouses. Nonetheless, the growth of retail implies to the need of Nepalese
retailers to gather ideas of the way global brands maintain continual supplies. For example,
common pickle brand ‘Navaras’ has low rate of availability in store shelves, thus losing
substantial revenue from the market. Furthermore, majority of transaction in retail market is
executed through cash which at times can pose critical threats to retailers.
Challenges Faced by Australian and Nepalese retailers
Changing Preferences of Consumers
Retailer are performing in challenging times with several factors rising level of
uncertainty such as minority government, lack of employment opportunities, increase in
electricity prices and reduced expenditure. All of these issues have resulted in significant lack of

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confidence and customers who are spending less in comparison to the amount estimated in
previous years. In the view of Beitelspacher and Rodgers 2018), consumers across the world are
highly besieged by numerous preferences and have easy accessibility to adequate information.
This is offering unprecedented authority to customers, thus leading companies to struggle for
accomplishing buyers’ changing expectations. Thus, Australian retailers in recent times are
principally focusing on data and technologies to better understand and accomplish the
expectations of today’s hyper-connected consumers. Meanwhile, similar challenges are
encountered by Nepalese retailers as younger consumers are greatly exposed to several recent
food product choices which typically include imported beverages available on various e-
commerce sites. Furthermore, though easy access to numerous selections counting international
brands in one place seems as an attractive proposition, majority of local retailers are facing
challenges to continue their businesses and maintain position in the market (Reimers and
Scheepers 2016).
Convenient collection
Another challenge for retailers in Australia is offering customers with convenient and
timely delivery services owing to its growing demand. As per Beitelspacher and Rodgers (2018),
when transitioning between online and in-store experiences, clients not only seek for similar
products to be obtainable, but further want their experience to be seamless. As a result, there has
been significant struggle amongst Australian rivalries to offer convenient collection to its
customers by integrating data across all interaction points which include online interactions,
sales in physical stores along with home service technicians with an aim to create integrated,
convenient omni-channel customer experience. However, Nepalese retailers do not typically face
this type of challenges as even now majority of customers in Nepal still incline towards shopping

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from physical stores. On the other hand, Nepalese retailers encounter challenges in digital
payment methods, as the industry still faces technical glitches while using digital wallets and
using e-banking as well as mobile banking services (Reimers and Scheepers 2016).
Industrial relation laws posing threats to Australian retailers
The increasing impact of number of changes to the industry relations framework is
impacting retailers, thus challenging them to compete with the foreign retailers. In addition to
decline of yearly growth in retail trade which is at 2.3%, Australian retail industry is facing
issues of high carbon taxation charges along with an increase in employee superannuation
outlays with around 2.6% pay increase in the retail award. Furthermore, considering workplace
flexibility, the Australian sector has been associated with new obligations in order to consult on
shift transformations, new obligations to take into account family-friendly rosters along with
recent parental leave obligations (Sharma, Mishra and Kaplan, 2017). Report mentions that
Coles is currently defending recently faced issue related to the approval of its latest Store Team
Agreement. This confrontation has been done more than a year after Coles’ team members
nominated overwhelmingly in support of it. This contract endorses flexibility as well as
simplicity across its business by amalgamating six distinct agreements into one. The company
further integrates a minimum average wage increase of 3 per cent per year, which is well onward
of the average wage growth of 2 to 2.25 per cent in the Australian economy (Bhattarai and Jha
2015).
On the other hand, foreign exchange is strictly controlled and not liberally obtainable.
Nepalese vendors have few opportunities accessible for digital payment, while numerous
companies recently claim to deal with digital payment elucidations for domestic purchases. In
contrast to Australian retailers, Nepal’s Intellectual Property Rights (IPR) laws as well as

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regulations are non-operational, ineffectual, and intermittently compulsory. Recent reports have
revealed that Nepal’s cabinet permitted a new IPR policy that has been applied as the
groundwork to formulate a draft Law on IPR (Export.Gov 2019). In the view of Bhattarai and
Jha (2015), this draft is presently under governmental assessment. However, there is an
underlying factor to suppose that the new legislation is likely to represent a considerable
development over current laws and principles and will seek new expertise within retail sector.
Cultural aspects affecting retailing in Australia and Nepal
Around 93.1% of all households in Australia have access to the internet services
since2015 with children less than 15 years. Australia being a culturally diverse Nation has
developed as a mecca for online businesses with additional number of web stores launching and
more average online spending taking place in comparison to other developed nations. The
increasing demand of E-Commerce services have facilitated retailers in Australia to spend
substantially on offering exceptional e-commerce services which has eventually resulted in sales
growth of around A$155 in 2017 (Salam, Panahifar and Byrne 2016). Australia largely
comprises of number of international students who you currently is considered as one of the
major consumers of Australian retail market. These younger consumers usually seek for
seamless customer service and products which reflect innovation and health benefits. Sharma
Mishra and Kaplan (2017) after the example of Dan Murphy as one of the best performing retain
brand because of its light and open store layouts, wide range of products along with competitive
prices and friendly employees to assist while shopping. Also, younger consumers are seen to be
impulsive buyers, who generally purchase frozen foods, juices and ready to eat noodles.
However on the other hand, aged consumers in Australia are morally driven towards food
products which are naturally sourced, farmed manufactured and packaged in local retailers, it is

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because they want their products as well as services to preserve the ethical standards and values
of the nation. Furthermore, with the culture of localisation, Australian consumers have been
focusing on hyper-local trend while purchasing any food products from the market. As a result,
focusing on hyper local development is enabling the Australian retailers to deal with the
increased competition from the range of global brands which have entered into the market.
According to Rajbhandari and Intravisit (2019), offering products which are directly sourced
from the local community can act as a point of differentiation which can reflect ethical
considerations of consumers who are interested to pay premium prices for these products.
Furthermore the hyper-local offer from an iconic Australian brand can provide symbolic
importance to the Australian retailers which global competition cannot provide.
In contrast to the Australian retail consumers, Nepal does not witness any case the
impulsive purchase. However, it is important to note that, with the elevation of shopping centres
as well as supermarkets in Nepal, they can be seen a growing independence among the youth
consumers of Nepal who has been showing women's inclination towards purchase which is based
on the array of exceptional story related attributes such as store layout ambience product
representation and behaviour and approach of the employees (Rajbhandari and Intravisit 2019).
Considering these factors the Nepal retailers can efficiently capitalise on the transformed
purchasing approach of consumers in Nepal and their willingness towards certain food products
which can generate high profit margin for the Nepalese retailers in future. Furthermore, by
drawing relevance to the retail structure and representation of Australia Nepal retail sector is
gradually tapping on welcoming global companies, store layout which will enhance their
shopping interest and exceptional services from clients which would eventuallystimulate
customers to purchase impulsively (KC and Timalsina 2016).

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Conclusion
Therefore from the above discussion, it can be concluded that from Australia to Nepal,
customer preferences and choices can vary on the basis of technology advancement, local
economies and cultural patterns. Since, retailers are gradually using websites and social media
for product and services marketing, the rate of buyers who have never made purchase from
online or social advertisements in Australia has been noted to be higher in Australia in
comparison to Nepal. Thus, Nepal retailers must take into account advanced technology to attract
younger customers and refurbish their physical stores to retain older customers who do not
incline significantly on online purchase. However, starting from fashion and footwear to
furniture and electronics, it has been noted that small retailers within the Australian retail sector
are making considerably more on each sale in comparison to majority of the other international
markets. Furthermore, focusing on hyper local development is enabling the Australian retailers to
deal with the increased competition from the range of global brands which have entered into the
market.

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References
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economic development (LED). Journal of Business and Retail Management Research, 11(2).
Ayers, J.B. and Odegaard, M.A., 2017. Retail supply chain management. CRC Press.
Banerjee, M. and Mishra, M., 2017. Retail supply chain management practices in India: A
business intelligence perspective. Journal of Retailing and Consumer Services, 34, pp.248-259.
Bayly, M., Scollo, M. and Wakefield, M., 2015. No lasting effects of plain packaging on
cigarette pack retrieval time in small Australian retail outlets. Tobacco control, 24(e1), pp.e108-
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Bhattarai, N. and Jha, A., 2015. Commercial sector energy demand projections of Nepal for
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