0

Bahamian Retailers Hit By ‘Showroom Effect’

BAHAMIAN retailers yesterday said they have fallen victim to the “showroom effect” with consumers using them as ‘fitting rooms’ before purchasing online.

Steve Hoffer, chief executive of Hoffer Sport, one of the largest sporting goods retailers in the Bahamas, told Tribune Business that many customers were using local merchants to ‘try-on’ or ‘try-out’ items only to purchase them online.

“What a lot of people do nowadays is they go into a store, spend an hour trying everything, and go online and order it, and that’s especially with name brand apparel and footwear.  We are starting to turn into showrooms. It’s a problem in the US as well. It’s happening with footwear, clothing or whatever,” he explained.

Mr Hoffer said issues such as the cost of freight, import duties and logistics were “only slightly” levelling the playing field for Bahamian retailers. “We have to do things a bit differently,” he added.

“The online shopping trend is affecting everyone. It’s a worldwide trend, and that is why we see malls in the United States shutting down. Online shopping has really taken off in the last few years.”

Mr Hoffer said Bahamian retailers would likely see some business from last-minute shoppers this Christmas season, arguing that local retail prices were becoming increasingly competitive despite the tax system-imposed disadvantages. He added that retail sales have been “way down” this year due to hurricanes and the economy, and said: “We’re going to gauge things for the next couple of days. I don’t expect a banner year in retail, but I can’t really put my thumb on it yet.”

Charmaine Daley, manager at John’s Shoes and Accessories on Carmichael Road, told Tribune Business she had witnessed a boost in customer traffic this past weekend, and expects sales to increase further as Christmas draws closer.

“We saw sales pick up this past Saturday. I would say that persons have started their shopping. On Saturday we were bombarded with customers. That has spilled over to this week. The real rush hasn’t started yet, though, and I expect our sales to further increase this weekend,” she said.

Comments

Chucky 6 months, 1 week ago

would you listen to this j@ck@ss, he'd have you believe that when you order online there isn't any duty or freight. when clearly freight on individual shipments is much higher, and therefore the duty applied to freight is higher.

Mr Hoffer said issues such as the cost of freight, import duties and logistics were “only slightly” levelling the playing field for Bahamian retailers. “We have to do things a bit differently,” he added.

The real trouble is that these guys all gouge us consumers, they charge 2 or 3 times what it costs to land the goods...

They should go broke like other retailers anyhow, if online is cheaper then so be it., That's what free markets are all about.

0

truetruebahamian 6 months, 1 week ago

Chucky, so how are you going to pay staff, rent, depreciation utilities, licences, government Value Added taxes, property taxes, increased replacement costs, NIB, insurances on property,goods and public liability, shrinkage (tiefin'), limited time on lifespan of goods - and on and on. Of course prices will be higher! Invoiced first cost times 2.6 only lands the goods in the shop before a profit can even be considered. So who is the j@ck@ss?

1

CommonSense 6 months, 1 week ago

Is that our problem or the store's problem? How you pay your employees is none of my concern. If it's cheaper to buy online and bring it in then I'll do that. At the end of the day we have bills to pay too. We can't help them pay theirs and still pay ours at the end of the month. They need to wisen up or shut down like Carl's.

2

DDK 6 months ago

If you were one of the employees I believe it would be a concern.

0

CommonSense 6 months, 1 week ago

BYE! Either lower your ridiculously overpriced items or suffer the consequences! We have options now and online is the way to go. You guys charge us for the cost of the item, plus the VAT you paid, plus the VAT that WE have to pay, plus the duty that you're charged to bring it in, PLUS your own markup prices. Shopping here is absolute hell!

2

SP 6 months ago

Thanks to online shopping, gone are the days of dealing with rude, pain in the ass, U.S. border agents, flying to Florida, renting cars, fighting traffic, paying for hotel and food bills, rushing from mall to mall and paying excess baggage fees!

Bahamian retailers will have to follow U.S. retailers and reduce prices to make profits from volume sales or close shop.

http://time.com/money/4812870/retailers-bankruptcy-risk-sears-amazon/

1

DDK 6 months ago

Favourable import duty rates should be given to those with business licences. The Bahamian public would be rather put out if all the retail shops close. Sounds rather like wanting to have your cake as well as eating it.

0

SP 6 months ago

If I want to go on a "real" shopping spree with the family, I take them to Panama and rent a condo or house in the Coronado or El Valle area 2 hours out of the crap in Panama city.

The downside is, Panama can get ugly very quickly if you end up in the wrong section of the city, which is easy to do because road markings suck!

Shopping locally only when absolutely unavoidable or for immediate must have items. They need to lower prices if they intend to seriously compete with online shopping.

0

hrysippus 6 months ago

Most people do not understand how business works .If the retailer cited in the article represents and sells a name brand of clothing or footwear, then the price it will be sold in this market is usually set by the manager for the area working for the company that owns the brand. The cost of the goods to the retailer is calculated to produce a retail selling price which they have determined that this particular market can bear factoring in all overheads that need to be covered. This is also true of most food items and toiletries. This why Quaker quick oats or Mahatma rice will be less expensive in Antigua or Jamaica than they are in the Bahamas. On-line shopping is threatening to close out retail shopping in every developed country and not just this one. Food retail will survive because of the weight to value ratio which precludes shipping mall quantities. Shipping container loads of 20,000 to 40,000lbs of groceries at a time is the only way Bahamians will be able to continue to afford the. Retail is finished, enjoy shopping at Kelly's and Hoffers while you can.

1

Chucky 6 months ago

what is sadly lost on most people, and clearly not disclosed by the jack@ss quoted in the article is that the retailers here are only paying wholesale price on the goods, then importing in quantity so freight per item is negligible (i.e. how many pairs of jeans fit in a 20' container) and then they gouge the hell out of us.

You can be guaranteed the ripoff retailers are paying less than $1.00 per item on freight, (again when considering a container load/cost per unit). In comparison the consumer pays about $10 per item via Mr.Shipit etc etc.

Cry as they will, these ripoff retailers live in OFB, Prospect ridge , Lyford, Etc Etc Etc, they are rich, not because they work hard, but usually because daddy give em a business or money to start, and they gouge us working class to death!

2

ohdrap4 6 months ago

well, i now compare prices, the girl at the courier said it might cheaper to buy here considering the info i gave her.

i wanted a freezer, i found it locally at 299 vat and delivery included. same freezer on amazon was 339+49 shipping then i have to pay the courier and broker to get it.

i also buy shoes locally because the courier charges kill the difference.

but clothes i keep going to the courier.

0

John2 6 months ago

Bahamian Merchants in every sector had better wake up and smell the reality roses of the present future trends in online shopping.Technology has made it possible for any Joe Blow or gran ma to sit in their homes or while mobile use their cell phones to order anything from anywhere around the world. Sectors such the local automobile retailers are now feeling the results as bahamians deal directly with foriegn exporters particually japan and bring in there cars at vastly reduce prices resulting in reduced volumes of sales for the local automobile retailers. The "show room effect" will continue to expand and move into other sectors of the economy. The advent and popularity of cryto- currencies .such as Bitcoin that is now being regulated in Japan and Hong-kong and accepted by some retailers there is going to be the death nail for many local retailers as its popularity reaches the Bahamas. Amazon it eating Wall Mart lunch. Online shopping is beginning to eat the traditional retailers lunch. Remenber folks in the 1990,s Bahamians knew nothing about texting because BTC did not offer it, while in Japan,Hong-Kong and Singapore,texting was childs play to the average citizen. Now that every one is texting, its just a matter of time before the crypto currencies are forced to be accepted here. If not Bitcoin the our own Bahamain version. My only advice to the local retailers is to Save some money and start making a decision on which cryto- currency ATM vendor you are going to buy your Cryto ATM machines from. . . .

0

SP 6 months ago

The only solution I see for saving retail in the Bahamas is for government to get off their hands and move towards using Freeports shipping capacity to turn the country into a duty free shopping zone similar to Panama.

This will be attractive to visitors from the North and South as people chose the Bahamas as a relatively safe vacation shopping destination. They can keep the VAT on sales and earn additional revenue from increased NIB contributions as retailers expand and hire more staff to service increased sales volumes.

Alternatively, we can take the usual road of procrastinating, talking and doing nothing as we watch retail nose-dive globally until it erodes more jobs and we will find ourselves following the same path as our dead tourism product.

The time to act is sooner rather than later!

0

Sign in to comment