Astonished by the call for taxing online sales from overseas suppliers, I wrote a letter to Richard Goyder (the CEO of Wesfarmers, which operates Harris Technology), Gerry Harvey and Dick Smith (see copy of the letter below) in which I used a personal experience to illustrate that it is Australian retail models, not taxation, which drive online sales.
Specifically, I referred to the kind of ‘piss-poor’ retail model that offers only overpriced but still second-best electronic goods, that fails to understand customer needs and wants, and that delivers no value-add for the extra overhead cost of shop-fronts and staff.
Harvey was quoted again today suggesting that Australian consumers should pay a little more at local retailers because it would save jobs and benefit the nation. He should have massaged that message a little more. High staff costs for people who, in my example, could tell me nothing about the kind of technology I was looking for, is a legacy of a union-protected labour market that will not survive international competition at all, regardless of taxing online retailers. If the staff at Dick Smith, Harris Technology and Harvey Norman were stumped by the simple job of advising on PVR (digital TV recording), let alone stocking or being able to order the appropriate electronics, they represent little more than a massive cost for taking my cash without adding any value at all to the transaction. Why would I, and thousands like me, not seek to leverage the hours we are forced to spend researching our own needs by sourcing the best price online. It seems obvious to me that doing that from the comfort of my own desk is infinitely more productive and satisfying than trudging from one store to another, watching the same blank faces and getting the same lack of advice from sales assistants.