Deregulation poses a serious threat to the very important economic and social value of a viable and thriving independent retail sector.

PREDATORY PRICING
When the Keating Labor Government introduced National Competition Policy in 1995, they failed to include a set of rules which would protect smaller traders from predatory conduct of large supermarket chains. This predatory behaviour includes under-pricing goods and services for a short time so as to draw 100% of the market share. Only large corporations have the capacity to carry out this practice, sometimes selling products below cost price for short periods. As a result many small businesses, such as our local convenience stores, chemists, butchers, fuel retailers and newsagents have been forced to close down because they can’t compete against such unconscionable conduct by larger operators. When this happens the public has NO CHOICE but to shop at large supermarkets.

“A move to Sunday trading will be an enormous labour cost burden to specialty store owners already struggling with skyrocketing rents” - Martin Dempsey, CEO, WA Retailers Association, November 2004.

Eastern states’ experience of deregulated trading hours strongly indicates that any swing in retail marketshare would be decidedly in favour of the major corporate retailers with resultant and devastating effects on both the independent retail sector, and thousands of smaller independent primary, secondary and tertiary sector businesses.

Following the deregulation of retail trading hours in Victoria, the Masters Grocers Association surveyed its members in 1997. It discovered that independent retailers had lost up to 70 percent of their Sunday trade. In Tasmania, where seven-day trading was introduced in December 2002, the Tasmanian Small Business Council found that small retailers had sales losses ranging from 30 to 85 percent on Sundays and weekly turnover drops of up to 50 percent. Research by the Queensland Retail Traders and Shopkeepers Association revealed that the introduction of seven-day trading in Queensland in 2002 resulted in many independent retailers losing up to 50% of their Sunday trade with overall sales losses of up to 60%.

The independent retail sector is responsible for purchases of locally manufactured and grown products with an estimated value of more than $500 million per year with between 80 percent and 100 percent of produce sold by independent retailers, grown or produced in Western Australia. Independent WA retailers’ support of the local milk industry has definitely helped to keep the current three dairies viable here.

Major supermarkets have targeted their product range to compete with a substantial number of small businesses (butchers, bakers and newsagents) that usually operate in traditional shopping precincts.

“As predominately family run businesses, newsagents will have significant family time eroded and will certainly lose market share if deregula tion of trading hours occurs” - Richard Hatch, Newsagents Federation of Australia (WA Branch).

There are hundreds of specialist service and trade supplier businesses, which rely in whole or part on the viability of a healthy independent retail sector. A shift in marketshare to the major chains will severely impact on the prospects of hundreds of businesses in the service sector.

In the case of existing small businesses, supermarkets are the primary anchor tenant and therefore, the major consumer drawcards for most shopping centres. Losses in marketshare by independent retailers, who are, in most instances, located in smaller suburban centres, will directly impact on the viability of small shopping centres themselves.

The 2004 Small Business Development Corporation’s survey shows that the independent retail sector continues to outgrow the majors in employment growth. Western Australia’s regulated retail trading hours regime has played an important role in making WA a leader in retail job creation.

The long term result of deregulation of trading hours will be fewer employment and training opportunities for retail employees, especially young people due to the demise of small businesses, where service and labour intensive employment exists.

“Family friendly” employment will be reduced resulting from the new arrangements which lead to greater neglect of children when families work.

Retailers in centres within a 3 hour radius of Perth will be hit hard by extended trading hours on Sundays. The Narrogin Chamber of Commerce and Industry’s member survey on this issue revealed that the majority of the small retailers in Narrogin “believe it would be detrimental to their businesses, and to our community to deregulate” (Narrogin Chamber of Commerce and Industry submission to the Review of Retail Trading Hours).

“The Moora Chamber of Commerce claim that … (deregulation) … would have very adverse effects on Rural Country Towns within close proximity to Perth. The extended trading hours would provide a huge incentive for Country residents to consider weekend shopping and social excursions to Perth and the Metro area, which in turn would have a very detrimental effect on the local economy at the expense of country retailers” (Moora Chamber of Commerce submission to the Review of Retail Trading Hours).

The “domino” effect of Coles and Woolworths moving into the regional retail sector is far more than theoretical when we consider the impact on independent grocers of open-slather trading hours in the North-West of WA:

“In many shopping centres in the north west there are large numbers of vacant shops, which were being run in a very effective manner and in a vibrant way by many small businesspeople in the Pilbara … when the major traders such as Coles and Kmart were operating in a regulated framework, small businesses - delicatessens and others - were trading on the weekends. I am referring to fishing and tackle shops and those sorts of businesses. When the market became unregulated, the big players such as Coles, Woolworths and Kmart went to 24-hour trading in some cases. After that, a complete reversal occurred. In one location Kmart started getting into many of the aspects that the small businesses were dealing in. Because it was able to operate on a 24-hour basis or an extended basis, it cornered the market.” - Robin Chapple MLC, Member for the Mining and Pastoral Region, Parliamentary Debate, 23/11/04.

Deregulated trading hours will have direct and indirect harmful effects on both individuals and community organisations, such as sporting, social and religious bodies, all of which play a vital role in maintaining the social fabric in our metropolitan and regional communities.

It may lead to many adverse social consequences, including reduced recreational opportunities for young people and an impact on religious and community activities.

It will have a major impact on Sunday Markets such as the Fremantle, Subiaco, Midland and Wanneroo markets, Arts and Community Festivals (such as the Fremantle Festival) and the Perth and Fremantle tourism precincts.

Fundraising ventures such as swapmeets, fetes and fairs which are traditionally held on Sundays by community and school groups will be significantly affected by Sunday trading.

Sunday is a critical participation day for athletes and sporting officials / supporters alike. The WA Sports Federation is strongly opposing the proposed new trading hours, which will affect over 600,000 registered athletes across all sports in WA.

Sunday trading will pose significant issues for the existing supply companies who don’t ordinarily deliver, on Sundays. Extended trading hours will mean that they will have to totally alter their operations for no extra reward.