Russell Zimmerman is the executive director of the Australian Retailers Association. In this special Q&A, he explains why he is optimistic for the remaining months of 2014.

How has the first half of 2014 been for the retailers you represent?

I think it’s fair to say that, over the past few months, the retail industry has seen a little bit of blue sky. We’re seeing retailers being more confident than what they’ve been for quite some time. And that really started right after the election in 2013 and has moved through.

What are you predictions for the second half of the year?

Everybody accepts the fact that we’ve got a huge budget deficit and we need to do something about it. If it is not too harsh then we are still in for good sales because we’ve seen that buoyancy since the change in government.

The way we move forward is also dependent on the make-up of the Senate and how quickly some of these things can get through the Senate, such as the repeal of the Carbon Tax. A lot of retailers out there have said their costs have gone up astronomically and they want to see the Carbon Tax removed. If you’re in the business of selling air conditioners and heaters, you would certainly want to see it removed.

I know there are some fairly difficult regulations in regards to ACCC laws in relation to warranties, and retailers are telling us of draconian moves that happened during the previous Government that they would like to see changed.

What opportunities do you see for retailing in general?

The first thing you have to look at is how consumers are buying products now. The big thing for retailers is to make sure that they’ve got a really strong presence in the online area. I don’t think it’s necessarily about price; successful online retailers are looking at how they can offer add-ons and services to their consumers that are not available in a bricks and mortar store.

Online is such an important space because consumers want to be able to buy things at their leisure. I am told by some of the sites overseas, by some of the big department stores, they see a spike when Australian retailers are closed. If that’s the case, Australian retailers need to be in that space to make sure our retailers are offering products at the right time, in the right speed, at the right price — not necessarily the cheapest price — but the best value for money.

What threats are currently present in the industry?

One of the big threats is spending power being removed by the Deficit Levy, because taxes are very rarely removed. Another threat is added costs to retailers and added costs to consumers, because that could slow down the retail industry.

The Government needs to think very clearly about removing the low value, GST-free threshold on imported goods. This is something that would affect a lot of retailers. It’s currently sitting at $1,000 and retailers would like to see that come down to around $30. I think the Government needs to do something about that before it becomes a bigger issue for retailers.