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The Island Continent Has Only Two Global Players
Australia is strategically positioned in the burgeoning Pacific Rim and is trying to find its niche in the world market. A low growth country with population centers in Sydney, Melbourne and other coastal regions, Australia faces the daunting task of overcoming cultural and regulatory barriers and expanding into nearby Asian markets, chiefly Indonesia.
The economy has shown signs of improvement since a three-year recession ended in 1993. The upshot of the recession is that Australians have become price-sensitive, fueling discount store development over department stores.
GLOBAL 100 HIGHLIGHTS
* Coles Myer Ltd. (34), with supermarkets, department stores, discount stores and specialty stores in Australia and New Zealand.
* Woolworths Ltd. (51) with supermarkets, department stores and specialty stores in Australia.
MARKET FACTS
* Australia is almost as large as the continental United States, but has a population of just over 18 million.
* Seventy percent of the population is heavily concentrated in the eastern and southeastern coastal region. Forty percent of the population live in Sydney and Melbourne. Domestic retailers are most concentrated here and test new concepts in these cities before expanding.
* Retail giants Coles Myer and Woolworths represent nearly 30% of all retail sales in Australia. Australia is primarily a slow growth country with few medium-sized markets. Population growth is occurring in areas north and south of Brisbane (on the country's east coast with 1.5 million inhabitants) and in Perth (on the west coast with a population of 1.2 million). Close trading ties exist with nearby New Zealand.
* The size of the country makes distribution burdensome and adds signicantly to retailers' cost structures.
MARKET INSIGHTS
Coles Myer (34) and Woolworths (51) are involved in nearly all the major retail sectors, but nonetheless face competitive threats, especially in the growing category killer segment.
Toys 'R' Us is one of several foreign category killers posing a threat. In response, Coles Myer has established its own category killers, competing in the stationery and toy sectors....