Google AI
The Times Australia

Times Media Advertising

Click and collect changes the economics of Australian shopping centres

  • Written by: The Times

The effects of click and collect on other retailers

Australia’s major supermarkets are transforming consumer behaviour through home delivery and click and collect services, but the effects extend far beyond grocery retailing itself.

Shopping centres were traditionally built around foot traffic. Supermarkets acted as anchor tenants that attracted thousands of people into a precinct each week. Once inside, shoppers would often buy coffee, visit a bakery, browse fashion stores, purchase gifts, collect prescriptions or stop for lunch.

That ecosystem depended on physical presence.

Increasingly, Australians are no longer walking through shopping centres in the same way.

Click and collect allows customers to order groceries online, drive into a designated collection zone, load bags into a vehicle and leave within minutes. Home delivery removes the need to visit the centre entirely.

For consumers, the services are convenient and time efficient. For many small businesses operating inside shopping centres, however, the consequences are significant.

The café owner relying on passing traffic loses potential customers. The independent butcher sees fewer impulse purchases. Bakeries, juice bars, gift shops and specialty retailers all depend heavily on people physically moving through a precinct.

Historically, many small retailers accepted high shopping centre rents because of the guaranteed exposure generated by supermarket traffic. That equation is now changing.

Importantly, rents have generally not fallen in proportion to reduced foot traffic. Many small operators therefore face the double pressure of weaker turnover combined with fixed occupancy costs that remain high.

The issue is especially important for suburban shopping centres where supermarkets dominate customer visitation patterns.

Shopping centre operators themselves may also face strategic challenges. A centre designed around traditional walk-through retail behaviour may need to evolve as consumer habits shift toward convenience-based collection models.

"For small business owners, adaptation is becoming essential."

Retailers increasingly need to create reasons for customers to physically visit their premises rather than simply relying on incidental foot traffic generated by anchor tenants.

Loyalty programs, weekly specials, local community engagement and personalised service may become more important than ever. Cafés may need experiential appeal rather than simply convenience. Food retailers may focus on freshness, expertise and specialty offerings that supermarkets cannot easily replicate through online ordering systems.

Some businesses are already adapting through digital engagement of their own. Social media promotions, SMS specials, app-based loyalty rewards and localised marketing campaigns are becoming critical tools for maintaining customer relationships.

The broader lesson is that shopping centres are no longer operating under the same economic assumptions that existed a decade ago.

Consumer convenience has permanently changed retail behaviour.

Australians increasingly value speed, efficiency and reduced travel time. Supermarket delivery and click and collect services satisfy those preferences extremely effectively.

For shopping centre small businesses, the challenge is no longer simply attracting customers into a store.

It is first giving customers a reason to enter the shopping centre at all.

Business Times

Business Ideas Changing the World

Every generation of business leaders faces its defining challenge. For some, it was rebuilding after war. For others, it w...

Build Your Business on Land You Own

Why every startup should own its website, domain name and customer relationships Starting a business has never been easier...

Workplace shift: Australians turn to career pacing as pay satisfa…

More Australian employees are prioritising flexible working arrangements over pay and job security, new research from globa...

Technology

Why Australian Enterprises Are Reth…

The corporate landscape in Australia has undergone a permanent structural shift over the past few ...

Local News

QLD Day

On Saturday 6 June, parkrun events across the state will be a sea of maroon, with communities  str...

Culture

Vaccinations in Australia: Who Needs Them, Wh…

Vaccination is one of Australia's greatest public health success stories. Diseases that once claim...

Travel

Sri Lanka: An Island Adventure That Delivers …

For Australian travellers looking for a destination that combines tropical beaches, ancient histor...

The Times Features

Vaccinations in Australia: Who Needs Them, When and Why…

Vaccination is one of Australia's greatest public health success stories. Diseases that once claim...

Melbourne Weekend Property Tour: South of the Yarra

Melbourne's south side has long held a special place in the city's property market. Stretching fro...

Veteran fundraiser also changing the lives of ordinary …

What started out as a fundraiser to help veterans is now having a positive impact on ordinary Aust...