MCC/QVM Board Meeting With Traders

Many issues where raised in the various feedback meetings between the MCC, the QVM Board and traders. It was always stated by Chairman, Paul Guerra that issues would be categorised for appropriate consideration. A meeting has now been called for Thursday 25^th October.

We don’t have an agenda for the meeting but we expect a structure something like this.

1.       Solvable issues with action about to be, or already, commenced.
2.       Medium term issues with a structure for consultation and action.
3.       Long term issues with a structure for consultation and action.

All traders are invited to the meeting at 3:30-5:30 on 25^th October at the Jasper Hotel in Elizabeth St. which is just around the corner from McDonalds.

Latest Retail News - 29/9/2012

Latest Retail News

1.    Payless Shoes placed into voluntary administration with 230 stores at risk.
2.    Just Jeans group to expand into Asia avoiding "structural difficulties" in Australian retailing.
3.    Iconic Adelaide bookstore, Mary Martin, placed into liquidation.
4.    Official data says Olympics killed retail in London.
5.    Fangsuo Commune in Guangzhou, China, was judged best designed store at World Retail Congress.
6.    Ritchie’s Supermarket CEO calls for moratorium on retail development saying there is already too much retail space.
7.    Choice says Bunnings met customer service expectations better than any other retailer.
8.    H&R Block report only 5% of taxpayers plan to spend tax refund on retail while 14% plan a holiday and 71% will reduce debt.
9.    Woolworths has offloaded its Dick Smith Electronics chain for $20 million to private equity group Anchorage Capital Partners.
10. Pumpkin Patch full year earnings decline 20%.
11. Customer survey of coffee shop chains picks Muffin Break as top performer.
12. Darrell Lea’s new owners forge deal to stock their confectionary in IGA supermarkets.
13. Toy Group, Funtastic, return to profit on better margins and more focussed range.

New Feature On This Page

Please note the TAC tab at the top of this page, just over to the left. This is your link to official Trader's Advisory Committee events and news. Our first TAC meeting since the election has been recorded there. Simply click on the TAC tab for the latest.

TAC Meeting – 27/9/2012

The first meeting since trader elections in August was a little low key with 3 of our new representatives on leave. Inductions and briefings have therefore been held over till our next meeting but in the meantime a few issues were discussed. We don’t have the minutes of the meeting as yet so the following are observations taken from the meeting and subject to correction.

Christmas Holiday Trading –
Saturday 22^nd December – normal trading day.
Sunday 23^rd December – a normal day for General merchandise with the exception of A, B, and C shed traders. Due to the proximity of the festive season it is expected that Fruit & Vegetable Traders will operate in A, B, and C sheds on this Sunday. Management will make special alternative arrangements for any General Merchandise Traders who are displaced. It is expected that there will be sufficient vacant stalls in the rest of the market to accommodate those traders.
Monday 24^th December – a Special Market Day operating as a Tuesday, with trading by General Merchandise Traders being optional.
Tuesday 25^th December (Christmas Day) – Closed.
Wednesday 26^th December (Boxing Day) – Closed.
Thursday 27^th December to Sunday 30^th December – Normal trading arrangements.
Monday 31^st December (New Years Eve) – Food will open. General Merchandise will close.
Tuesday 1^st January (New Years Day) – Closed
Saturday 26^th January (Australia Day) – Trading arrangements to be determined. Trader’s views will be sought.

Trading Hours –

The deli representative raised the question of uniform trading hours in order to better take advantage of peak trading around closing time on Tuesdays and Thursdays and to help remove confusion for customers. He suggested we could consider trading to 3:00 pm on Tuesday, Thursday, and Friday with Saturday and Sunday both trading to 4:00pm.

It was argued that 3:00 would simply become the new peak as many local customers were always going to leave shopping until the last minute but providing greater standardisation was seen as desirable. There was no discussion on revised starting times.

For further discussion.

MCC/Board Feedback Summary and Action
A meeting of all traders is scheduled for Thursday 25^th October, 3:30 – 5:00, at the Jasper Hotel in Elizabeth St. just around the corner from McDonalds.

Ed: Please note that there is a dedicated TAC tab at the top of this page. You can click on that tab at any time to get the latest TAC news.

COMMENTS:
29/09/2012 07:54:33  "The meeting with City Council and the Board is set for October 25th you say,  that's 2 days before the Council elections. What a fortunate coincidence. Political football anybody?" Hugh                

Best Store Design For 2012

In our previous post we featured the best TV advertisement from the World Retail Congress and now we show pictures of the best designed store for 2012.
Fangsuo Commune in Guangzhou, China, was judged the best store design for its combination of bookstore, fashion and gallery creating a relaxation and "hang out" destination along with shopping.

Best Retail Ad of the Year

The 2012 World Retail Congress awarded department store John Lewis with the best retail advertising campaign for the year. See the TV ad here -

Another Mayoral Candidate Targets QVM

John So Jr. Is standing for Deputy Lord Mayor on the mayoral ticket of arts executive Gary Singer, and has specific plans for QVM.

Mr. So aims to revitalise the Victoria Market area into a Federation Square type precinct. “We need to establish permanent kerbside cafes, cultural and tourist attractions over there so it becomes an all-day and evening activity centre and a new people’s square of the 21^st Century.”

Should traders be getting excited with all this “revitalise” talk? The MCC election happens next month.

Have Your Say click here

Why Are Convenience Stores Proliferating?

Convenience stores sell a limited range of high priced goods while their supermarket competitors sell a huge range of low priced goods. How can both survive?

In Honolulu a chain of convenience stores called ABC (All Blocks Covered) can be found on most city corners and operate from 6am to 11pm. In Mexico, the OXO chain opens three small stores every day – yes, every day. In China they calculate that mini grocery stores positioned in apartment areas will attract regular shoppers within a 500 metre radius for all their basic needs.

So how do these overpriced minis survive? It is in their name – convenience. Convenience stores don’t provide price value, they provide time value. Convenience stores don’t satisfy shopper’s wants, they provide shopper’s needs. There are many examples of convenience stores in Australia and the city of Melbourne has seen a surge in corner stores as the number of city dwellers continues to rise.

In Australia we are lucky enough to experience high employment and our busy lives need the convenience these stores provide. Corner Milk Bars didn’t die after all.

Choice Cans Department Store Service

Consumer group, Choice, used mystery shoppers to test the customer service standards of some of Australia’s biggest department stores and the results weren’t pretty.

Claims of “better customer service than you can find online” have been made by the likes of Myer, David Jones, and Harvey Norman but they all suffer with customer service levels according to Choice.

Bunnings and Woolworths were in the best performers category, and JB HiFi and Bunnings were identified for quick assistance but other comments included –

                Dick Smith – “examples of poor customer management”.

                Target – “poor product knowledge”.

                David Jones – several examples of “poor customer service”.

 K-Mart was taken to task for staff shortages and Harvey Norman noted for poor customer engagement and inconsistent product knowledge. Some of the companies were identified for not accepting “change of mind” returns. Funny, we thought that was pretty standard in retailing.

L Shed – A Great Opportunity?

The success of M shed will rely on its “inclusion” into the market.One of the major solutions to creating a good trading environment in M shed is getting a row of traders on the other side of the aisle.
To help achieve that inclusion we either get L shed traders to trade from the M shed side of their stalls or we establish a new row of traders behind L shed. There are weather issues at the back of L shed but they are manageable, just ask Queen St. traders. We can only assume that L shed traders would welcome an opportunity to double their public exposure.

There could be new merchandising possibilities for L shed traders. Imagine being able to show a different face towards M shed. It would be a bit like having two stalls in one. Now, let’s not get carried away. There are strict controls on what you can sell from your stall – for good reason. But the extra merchandising possibilities of an additional store front could make this a very attractive opportunity.
Like any other retail venture we would need to do this properly. There would be no sense in creating a simple adhoc rear entrance to current stalls. A professionally merchandised display to M shed would help create that important "buzz" of customer traffic and benefit all traders involved. Most traders seem to agree that M shed has potential with its fresh new look and innovative setup. Management have a lot more to do if it is to succeed, but traders have a critical role as well.

Have Your Say - click here

COMMENTS:
26/09/2012 01:51:09 m shed " Agree totally with the above comments. If they open the door, so to speak, the people will come." Andy 
30/09/2012 06:12:19 L- shed "Wake up people, we need to fix the problems we have in c shed before we can even think about putting in a new shed... Really lets think about what we are doing, & stop colour coating the real issues"                               

Latest Retail News – 22/9/2012

Latest Retail News – 22/9/2012

1.       David Jones considers sale of 4 flagship, Melbourne, and Sydney stores – value $612m.
2.       Myer’s Executive General Manager (Stores), Nick Abboud, resigns.
3.       Myer boss, Bernie Brooks, doubts online sales will grow beyond 10%.
4.       New York to enact law restricting the size of soft drinks as they fight obesity.
5.       Woolworths launch stickers that allow customers to pick their specials.
6.       Rip Curl says it is open to investment/purchase offers.
7.       Ibisworld says consumer goods retailing will continue to decline.
8.       David Jones profit falls almost 40%.
9.       Japanese clothing giant, Uniglo, coming to Australia.
10.   Kathmandu profit down by 11% but remain upbeat for 2012/13.
11.   Orotron licence to sell Ralph Lauren goods in Australia expires 2013.

Retail Vacancies Reach 5 Year High

Bridge Rd., Richmond’s vacancy rate has grown from 2.9% to 11.5% over the past two years. Previously regarded as a retail mecca, the number of vacant shops and “closing down” sales is at the highest level in 5 years.

A recent survey has shown that Church St Brighton, High St Armadale and Acland St St Kilda had the lowest vacancy rates. Other results were – Burke Rd Camberwell (2.8% to 7.2%), Clarendon St South Melbourne (0.6% to 6.1%) and Puckle St Moonee Ponds (0.5% to 4.2%).

Businesses Urged To Switch Off Internet Explorer

A high profile virus security company, AVG, has warned of a new vulnerability in Microsoft’s Internet Explorer program that places businesses at risk of cyber attack.

AVG security advisor, Michael McKinnon joined calls from tech firm, Rapid 7, to use alternative browsers until Microsoft attend to the problem. – this problem first posted 20^th September.

Hidden Unemployment – The Middle Income Minefield

Australia’s unemployment rate is the envy of most countries but there is growing evidence that  middle income job losses are on the rise.

The eastern suburbs of Sydney and the inner suburbs of Melbourne have been identified as hotspots as pressures in the finance and professional services areas create job losses. A combination of rising unemployment and lower participation rates are blamed. For many years Morgan Research has been critical of ABS labour calculations which have yet to identify the middle Australia unemployed.

Department Stores Adjust To New Times

David Jones has highlighted the significant value of its flagship properties in Melbourne and Sydney as it contemplates downsizing its department stores. DJ’s claim they are not interested in selling their properties but they are looking at alternative uses like inviting other retailers including restaurants into their fold. DJ’s are moving to smaller “village” style stores that concentrate on fashion and beauty.

Myer is looking at smaller operations as well although concentrating on a full department store presentation. Myers, Bernie Brooks is also cutting property costs by leaning on landlords. He says rent cuts of 20% are typical.

Confusing Retail Terminology

There was a wee bit of confusion at my local store this morning.  When I was ready to pay for my groceries, the cashier said, "Strip down, facing me."

Making a mental note to complain to my local politician about how "security" is running amok, I did just as she had instructed.

When the hysterical shrieking and alarms finally subsided, would you believe...she was referring to my credit card.................

I have been asked to shop elsewhere in the future.
 

They need to make their instructions to us Seniors just a little clearer!

 

Thanks to Morry for this one.

The Booming Retail Category

While general retailing struggles, food seems to be churning along at its own merry pace with some innovative concept stores that are exciting customers. The following were featured in Inside Retailing this week.

Eataly, New York City – authentic Italian cuisine from the white tablecloths to magnificent pannini, pizza, and pasta made on the premises.
Calbee Plus, Tokyo – a shop that sells a full range of potato chips and mesmerizes customers by showing them the whole process from raw potato to finished product.
Rythm Kitchen, London – Caribbean street food that joins a flush of other enticing food concepts at London’s new Stratford shopping centre.
Hotel Chocolat, London – boasting its own cocoa plantation in the Caribbean, this innovative business shows off different concepts in each store, and features products like chocolate body scrubs.
Maille Mustard, Paris – just mustard but bright and colourful merchandising plus little innovations like filling your jar with mustard of the month makes this a very successful retailer.
Happy Lab, Melbourne - Happy Lab is the strange fusion of chemistry-themed packaging with all-natural confectionery.  It sells brightly coloured confectionery in plastic test tubes, conical flasks, petri dishes and beakers.

Tourist Watch – 21/9/2012

Tourists are very important to our business in the top end of the market and this weekend the following tourist events are in Melbourne.

1.Spring Racing Carnival in operation till 18^thNovember. Underwood stakes this Saturday.

2 AFL Final Series – Adelaide Crows fans in town for Saturday night’s match against Hawthorn at the MCG.

3. NRL – Melbourne Storm v Manly Sea Eagles Friday evening in Melbourne. Expect some Sydney rugby fans in town.

4. Royal Melbourne Show starts this Saturday and runs through till 2^nd October. Expect some extra regional visitors in town.

Underground Carpark For QVM

In the upcoming election for Melbourne’s Lord Mayor, John Elliot has nominated as Deputy Lord Mayor on a ticket with Lord Mayoral candidate Gary Morgan, a well known pollster.

Mr. Elliot announced yesterday that a key issue in their platform is a series of underground carparks around the CBD including at The Queen Victoria Market.

In the cut and thrust of an election you often don’t get too much detail on proposals but we will watch this one with interest.

 

The current Lord Mayor, Robert Doyle has nominated for another term.

Should We Trade On Public Holidays?

"If traders are allowed to trade, we will trade."
Each year the market needs to make decisions about whether they trade on public holidays or days in lieu of public holidays. There are a number of factors to consider and often there will be different decisions made for different sections of the market. There have been recent occasions when food has closed on a public holiday but General Merchandise remained open.
Trading decisions are made in the TAC (Trader's Advisory Committee) and up until now, trader's representatives have adopted a fairly simple approach on behalf of General Merchandise Traders. If traders are allowed to trade - we will trade. This is loosely based on an entrepreneurial philosophy that, if there are customers around, we will serve them. Public holidays are often related to increased tourism and basically traders have been willing to grasp any opportunity to improve their sales. Understandably, SL traders are particularly keen to trade because they are paying rent for that day no matter what decision is made by the rest of the market.
Recently there has been some wavering from that philosophy by some traders who feel that hard working traders also deserve a holiday. What do you think? Should we stick with our traditional philosophy? Or would you prefer to consider each occasion on its merits? In other words would you prefer that the market surveyed all traders, say once a year, to determine how we handle each public holiday in the coming year.
Let us have your thoughts. Decisions will soon be made about the upcoming Christmas/New Year trading period.

Have Your Say - click here

COMMENTS:

19/9/2102 1358 Trading On Public Holidays – “I suspect any change of heart by traders is due more to poor business results than anything else. If business was booming we wouldn’t be giving up any trading days. Adjusting to the realities of current retailing conditions is OK as long as it doesn’t dig our hole a little deeper.”

19/09/2012 15:23:44  "I don't think we should trade on new years day or Australia day as a lot of us will be either drunk or hungover and definitely not Anzac day as a mark of respect for those who fought for our country. "

 20/09/2012 05:40:57 trading on public holidays "Trading on 'public holidays' is our given rite!! whether it be SL or PE traders.the  "office" decided about 15 years ago "they" didnt want to work on the extra days b'cos they needed a break.The 'office' then approached the food traders(fruit,veg,meat hall and delis) who  said they didnt want to work,but when the 'general' traders  got the opportunity to trade,they were told there will be no food traders!! as the 'office' think they are the attraction to people coming to US!   so in conclusion, we were and ARE doomed to fail once you take something away of course u forget about it as is the case here".
Ed: Actually, general merchandise traders have regained the right to trade in recent times. There have been a number of occasions when management have proposed that we close for public holidays, but our TAC representatives insisted on trading, even if food had decided to close. The most recent examples included Anzac Day 2011 (holiday in lieu on a Tuesday), and Boxing Day 2012 (holiday in lieu on a Tuesday) when General Merchandise traded without food - both were considered successful trading days.
So management have been prepared to let us trade on public holidays but some traders are now questioning whether we should. This article is designed to clarify traders wishes as we move into a new holiday season.

19/09/2012 2130 on GMT facebook - "Let's see what other tourist destinations do - zoo, eureka sky deck, aquarium, gallery, museum - I bet they are all open"

20/09/2012 21:58:23 Trading on public holiday "19/09/2012 15:23:44  ""I don't think we should trade on new years day or Australia day as a lot of us will be either drunk or hungover and definitely not Anzac day as a mark of respect for those who fought for our country. "
"I do too agreed with this comment above, sometime money should'n come first given the fact that we have been in bad business condition. Think about your life and your family on those days as well. I just hope public holiday will simply be the same to us just like all others workers or offices."
  
21/9/2012 17:32:20 Trading On Public Holiday - "Sorry, but if you want to trade and have holidays like other workers and offices you are in the wrong industry. You can't have your cake and eat it too."                                             

Traders Speak Out - 19/9/2012

We have received a number of comments from traders over the last few days and we have linked them with the articles below. Just click on the heading to be taken to the original article.

Why It Will Be Difficult To Justify A Rent Increase in 2012
14/09/2012 21:11:49 Rent rise accountability? "I sooo agree with you about the rent issue for 2012."

17/09/2012 11:41:55        Accountability to Spending - I am so over this string bean alley failure that it probably has been a clever ploy to distract traders away from our own problems in the day market..there seems to be some great ideas and push from Chris the new fella in charge on the real front the actual market..he is trying and that is great news..the people at the top of the chain need to speed up their analysis and see what they can do to repair the market image..we have people coming to the market no issue..i am not blaming the market for the quiet weeks we are having..it is most places..the problem is we are not attracting the quality shopper ..the person who goes to the sales in any dept store or shopping centre and spends 200 to 300 on good branded specials..the market management have decided to expand the market with this string bean "HANG MYSELF CONCEPT"..without really at trying to repair and put money into the main market..if the rumours are true and they spent $300,000k would it not been wiser to put $100,000 into a 3 month tourist campaign which would have run until end of December..i mean targeting interstate areas but also hard working areas like Geelong, Melton, Dandenong, Traralgon..people want quality bargains..why is so hard for these people in the office to understand..you know why..they  are on free meals...could you imagine if the market sunk that money into  hiring 30 buses (CALLED IT FREE CHAMPAGNE AND COFFEE AT THE VICTORIA MARKET)..with 40 people in each from different areas and brought them here..the there probably(not sure) be change from $50,000..they could had incentives like 'SPEND $5000 and get ?????” They keep saying we are limited with money, PLEASE MY 4 YEAR DAUGHTER HAS BETTER IDEAS.  she said the other day, " daddy I am bored", we need some entertainment for kids over the summer..i don't know what the answer is but putting money into something to benefit the night market only sucks..it isnt fair..seriously maybe someone else comments reflect the problem as well," the market is stuck in the old days with many traders that simply don't belong there (not their fault, the market mgt for allowing them in)..TO ALL MANAGEMENT ..CLEAN OUT THE COBWEBS BEFORE YOU WASTE ANYMORE MONEY..that includes getting rid of dead weight in the office.

Spring Racing Carnival Promotion
 15/09/2012 00:00:48 QVM marketing team "The problem with the current QVM marketing team is they think small. Cooking classes, small fashion parades that no one seems to notice, gusto festival, small market week events, the great cheese platter event and so on. All this time and energy on events that cater for a few hundred people at most.
It's time they are replaced with a marketing team that thinks big!
We need time and energy spent on a large T.V. Promotion and ""bigger"" print campaign, to promote to not just a few hundred people but to hundreds of thousands of people.
We are ment to be a huge tourist attraction and one of the biggest and greatest markets in the world. But our marketing is at small surburban shopping centre standard. "
Ed: I'm not answering for QVM marketing but I suspect this is a case of "you play the cards you are dealt". Your comment is valid but it probably needs to be referred to the board and MCC who approve or disprove budgets.

Customer Comments
15/09/2012 05:45:35 Leanne Cole post "The Leanne Cole post showed professional photography and positive comment but how come there is an advertisement from someone that does not trade at the market and is a competitor to those that do?" Terry Lawn (Airllywood) 

Market Musings - 15/9/2012
15/09/2012 22:19:11 String bean alley "String bean alley falure of the year! More like biggest falure of the last 20 years."

Traders Block Tourist Buses
15/09/2012 22:22:10 Traders parking in bus lanes  "Nothing has changed, including a trader representative parking there all day Saturday."   

Have Your Say - click here

                             
                         

Market Musings - 15/9/2012

Market Musings

-          Instead of leaving our String Bean Alley Information Container empty, why not position it down at Station Pier and welcome boat passengers with QVM tourist brochures – thanks to the trader who gave this idea.

-          Seen the online review of our new Market Insider Tour? – catch it here http://www.weekendnotes.com/market-insider-shopping-tour-queen-victoria-market/

-          Saturation posting of trader specials on QVM’s Facebook page. Worth a look.

-          Is it just me or is QVM inaction on String Bean Alley the failure of the year?

-          A quiet week of trading and at least one trader blaming it on worldwide religious unrest- lack of consumer confidence isn’t helped by scary stuff in the news.

 

Add your thoughts - click here

Spring Racing Carnival Promotion

In response to some trader comments posted on these pages, we asked Andrew Cyples to give us a rundown on promotion plans for the Spring racing Carnival. Here is his rundown -

"The Spring Fashion Fling held on Sunday 2 September highlighted all of the key trends for the season including spring racing attire from the Market's general merchandise retailers. 14 looks were showcased on the day with most outfits totalling between $50 - $80. Traders from Victoria Street, F Shed and the upper sheds were included in the shows. All fashion traders were invited to express interest in participate in the show with 8 traders being showcased on the day. The fashion parade received a positive response from both traders and the general public with PR extending to twitter, instagram and a range of fashion focussed blogs.

 Images of the event are available from the Market's Facebook Page http://www.facebook.com/pages/Queen-Victoria-Market/15800351906

 The General Merchandise Pages in the Spring edition of Marketlife incorporated Spring Racing attire from a range of traders. 100,000 copies of the magazine were distributed via the Herald Sun on 30 August 2012. The Magazine is also available onsite at the Market at at nearby hotels including the Radisson Hotel, Hotel Ibis and Hotel Discovery. Spring racing product sourced for the Magazine was also incorporated into print and radio advertising in the Herald Sun, City Weekly, The Age and on Mix 101.1. 

 We are also approaching organisations such as the Victorian Racing Club to come onsite to cross-promote the Spring Racing Carnival along with the Market's Spring Racing Offering.

 A number of traders have spoken to us about using their co-operative marketing fund to assist in promoting their spring racing offering. If any traders are interested in finding out more information about the cooperative marketing fund they can contact the Marketing Manager on (03) 9320 5822 or info@qvm.com.au "

 

Latest Retail News - 14/9/2012

Latest Retail News - 14/9/2012

 

1.    Bunnings taken to court after parallel importing Weber BBQs.
2.    Masters market to females in male dominated hardware category.
3.    New security cameras track customer movement patterns and identify shop hot-spots.
4.    Myer report 14.3% drop in profit for year to June.
5.    Federal Government reports domestic tourism up 6%.
6.    NSW Government supports lowering GST tax threshold on goods bought online.
7.    New report suggests lowering GST tax threshold not as hard or costly as first thought.
8.    Estee Lauder takes Target to court over “fake” MAC cosmetics.
9.    Fashion retailer, Cotton On, opens first stores in Phillipines.
10. Westfield’s Stratford Mall in UK a huge winner during London Olympics.
11. Ojay’s receiver says buying interest offers some hope of rescuing the fashion retailer.
12. The Good Guys take top award for customer service in electronics category.
13. Consumer confidence on the rise but still weak.

Trader’s Refer Tourism Request To Board

It was way back in April 2010 when General Merchandise Traders first informed management that there was a serious flaw in the results of contemporary customer surveys. These surveys did not identify the critical importance of tourists to trade in the top end of the market. General Merchandise Traders representatives made it clear to management that QVM marketing showed a bias to food and local customers that needed correction in the form of a major promotion program directed at tourists.

Since that time there has been much discussion and correspondence with management culminating in a letter to the QVM CEO on 22^nd June 2012. The end result is that our CEO has been unable to offer what we consider is a major tourist promotion program. We have now referred this issue direct to the QVM Board.

It should be noted that whilst we are grateful for any measure (Market Insider Tours, greater liaison with tourist groups etc.) that boosts tourism we believe the current state of retail business, and the neglect of recent years, requires more. That is why we are seeking a major tourist promotion program. This is not a time for simple discussion. It is not a time for “playing around with the edges” of a serious problem. We are seeking significant action.

The round of recent Trader/Board/MCC discussions has generated much anticipation and a fair share of goodwill. Has it been just a talkfest as some traders have suggested? Time will tell, but tourism promotion is an issue that will test the new Board’s commitment to correcting past wrongs and to meet the needs of major stakeholders. This is truly a case where action can speak louder than words.

 

Have Your Say - click here

Tourist Watch – 14/9/2012

Tourist Watch – 14/9/2012

1.       The Spring Racing Carnival officially starts Saturday 15^th September and runs through till 18^th November. This event usually brings its fair share of interstate and international tourists to Melbourne. We particularly look forward to New Zealand arrivals.

2.       AFL Finals – Perth’s West Coast Eagles play Collingwood at the MCG on Saturday evening.

3.       V8 Supercar Races at Sandown over this weekend.

Why It Will Be Difficult To Justify A Rent Increase In 2012

Last year’s rent increase attracted a fair share of criticism from traders, especially after they had explained the current economic difficulties being faced and presented a petition to management. The petition was signed by over 200 GMT traders, requesting either a rent decrease or for rent increases to be placed on hold.  There are indeed many factors that need to be considered when deciding on how rents should move and this year we believe a number of those factors are working in favour of no change.

First and foremost is the state of retailing generally and the impact on rents. Premier Investments Group (Just Jeans, Peter Alexander, Jay Jays, and Smiggle) recently announced that they were closing 50 shops and seeking rent reductions in the remaining sites. In June this year A spokesperson for a 63 store jewellery chain stated -“The conversations we’re now having are at the stage of reducing rents at renewal time. The incidence of unrealistic increases has evaporated. They [landlords] might still send you a letter asking for an increase but you can go back saying, ‘well that’s not going to happen under these economic conditions, we’re not going to give you an increase when retail sales are in decline”. In May this year, Bloombergs reported “Australia’s biggest shopping-center operators, Westfield Group, Stockland and GPT Group, are lowering rents for new stores while existing tenants call for cuts as major-mall sales drop for the first time in a decade.”

These are all relevant events but one closer to home was the announcement by The Melbourne City Council on 28^th August. In its financial report for 2011-2012 the council reported a better than expected performance by QVM and a special dividend to Council resulting in a favourable variance of $0.236 million. Further, The Future Melbourne (Finance & Governance) Report released on 11^th September stated “QVM’s performance for the period ending 30 June 2012 resulted in an annualised return on investment of 10.38 per cent, above the established benchmark return of 4.56 per cent (150 per cent of the bond rate).”

What is significant in those announcements is that QVM management had given the need to offset rising costs as the primary reason for raising rents last November. We are extremely pleased to see that our money has adequately covered "running costs" and more in 2012. Traders made it clear last November that a rent increase was totally unacceptable without a significant improvement in trade at trader’s stalls. That improvement hasn’t happened and we feel it is about time that there was accountability at all levels for what is happening at the coal face. On that measure, it is difficult to justify a rent increase.

Have Your Say - click here