We’ve read stories published news outlets about the economic outlook for 2025. Often, they quote either organisations representing big business or the work from think tanks that are distanced from everyday local retail.
Our outlook for local small business retail in 2025 is based on conversations with local retailers, small business retailers. these are typically retailers on the high street across a range of business types and in different settings: city, country and remote.
The thing is, there is no one outlook. It does vary by geographic situation, business type retail setting (mall versus high street) and, most important of all, the skills and resources of the retailer.
The news outlets publishing these general outlooks are filling their pages and pixels with fodder. Okay they do have data to backup their reports. It’s blended data though. The differences across sectors and geographical situations does differ considerably.
Now to our outlook for 2025 for local small business retail in Australia.
The outlook is good. We see growth for retailers engaged with running efficient customer-focussed businesses. Typically, these are retail shops not constrained by the expectations for their type of business. They are flexible businesses prepared to tread away from expectations in pursuit of sales.
Here’s what we mean.
Garden centres with the best outlook for 2025 are those that are not your traditional garden centre.
Bike shops with the best outlook fort 2025 are those that trade outside of what is expected for a bike shop.
Bookshops with the best outlook for 2025 are those that are not traditional bookshops.
Newsagents with the best outlook for 2025 are those that don’t run traditional newsagency businesses.
The common attributes for the local retail businesses with the best outlook for 2025 are:
Staff efficiency. Managing labour cost as a percentage of revenue to be as low as practical.
Shopper efficiency. These are businesses getting shoppers to spend more each visit and to come back more often.
Gross profit value. These are businesses setting prices based on value delivered rather than obsessing offer what others may charge for the same products.
Return on floorspace. These are businesses focussed on using space well and not leaving things to sit for too long.
Return on inventory investment. These are businesses tracking stock turn and buying to maximise this.
While national economic forecasts often paint a broad and sometimes misleading picture, the reality for local small businesses in 2025 is far more nuanced. Success hinges on a combination of factors, including adaptability, efficiency, and a customer-centric approach. Those retailers who embrace innovation, challenge traditional business models, and prioritise value over conformity are poised to thrive. By focusing on optimising staff and shopper efficiency, maximising gross profit margins, and ensuring efficient use of space and inventory, local businesses can navigate the complexities of the market and secure a prosperous future.
2025 is a year of opportunity in local small business retail. the opportunity is there for the taking. Having success to share in December this year depends on decisions and actions of each local small business retailer. No matter your size, budget or resources, there are decisions you can make today that mean your story by December this year will be one of which you are proud.
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