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Australian retail business costs surpass UK and US

Australian retailers are facing higher costs than those in the UK and US, according to a report released by the Productivity Commission today.

The report, titled Relative Costs of Doing Business in Australia: Retail Trade, said the high costs for retail business in Australia was driven primarily by ‘geography, markets and commercial decisions.’

In a move that will please retailers campaigning for a change to government regulations, the Productivity Commission says some of the government’s restrictions have contributed to costs.

Government limitations imposed on trading hours, retail space, workplace relations, transportation and liquor licensing were among the factors said to inflate costs.

The Commission put forward two major restrictions that needed to be addressed by the Government: trading hours regulations and planning and zoning regulations.

“As was the case in 2011 when the Commission undertook an extensive inquiry into the economic structure and performance of the Australian retail industry, retailers continue to operate under several regulatory regimes that unnecessarily inflate their costs and restrict their ability to innovate,” the Commission states.

“With the exception of Victoria, reforms since then have been piecemeal, and incomplete across most jurisdictions.”

The Australian National Retailers Association (ANRA) has welcomed the report, which coincides with the Council of Australian Governments (COAG) meeting in Canberra today.

“The complexity of current restrictions placed on trading hours, such as the difference in hours for the sale of light bulbs vs. light fittings, is impacting employment growth and customer choice,” ANRA CEO Anna McPhee says in a media release.

“The findings follow similar findings made in 2011 and similar recommendations in numerous other inquiries. It’s about time Governments stop wasting time and money on reviews and “open the doors”.”