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How many retail and hospitality venues are there in Australia?
Hello! Thank you for your question about the retail and hospitality venues in Australia. The most useful sources were Deloitte's Tourism and Hotel Outlook, Factual, and Australian Bureau of Statistics. The short answer is there are approximately 235,385 hospitality venues and there are 1,753 shopping venues, both of which can be further divided into smaller segments.
MARKET TRENDS
To get an overall view of the hospitality industry, I examined the Australian Bureau of Statistics which shows that Accommodation and Food Services has the highest entry rate at 19.2% and its survival rate is 53% across June 2012 to June 2016.
In 2016, there was a surge in growth of 10% for international visitors and 7% for domestic vacationers. The international passenger traffic to and from Australia also shows the same trend with numbers reaching record highs in 2015 at 3.9 million. Passenger movement on international airlines has a consistent growth of 5%. International visitor expenditure grew by 17.6%. Combined with domestic activity, the total tourism expenditure grew by 7.6%.
The hotel management industry reports in July 2016 that the hospitality industry would likely see growth for another two years prompted by an increase in tourist spending, which is predicted to reach $167 billion by 2025. The first nine months of 2016 generated $1.7 billion of hotel transactions.
Hotel market performance increased to 68.7% and hotel room rates increased by 2% as of June 2016. Sydney performed the best among major hotel markets hitting record levels of 89% with room rates growing 7.2% as of June 2016.
The retail market witnessed high growth over for years and one of the most competitive at the global level. Technavio forecasts the retail industry to grow at a CAGR of 2.39% from 2016 to 2020.
David Rumbens of Deloitte says the overall retail sales growth for 2016 is 2% and is expected to grow to 2.4% in 2017 and 2.7% by 2018. He attributes this growth to international tourism being at records highs in recent years. He adds, "Tourism from China alone is around $1.4 billion per year and is set to quadruple over the next decade. Strong growth is expected from India and the Middle East."
Deloitte also reports that 82% of Australian retailers can expect earnings growth, with 41% of them anticipated to see a growth of 5%. Surveying top 250 Australian retailers, Deloitte found that 46% of brands sold were American imports.
MARKET SIZE
Hospitality venues encompass a number of segments including accommodations, entertainment, dining and travel. In order to obtain these numbers, I have used the Factual database with key words such as 'entertainment', 'dining', 'taxi' etc and then applying categories in the database. Approximate numbers are as follows:
Total: 235,385
The tourism industry overall has a growth of 7.6% and the projected market size by 2025 is $167 billion. The market size for hotels alone is $1.7 billion in 2016 and has an expected growth of 2%.
The retail industry is closely tied to tourism. Tourist (international and domestic) expenditure totaled $130 billion. Of this amount 39.7% was on retail spending, including $36.1 billion (27.7%) on food retailing and $15.6 billion (12.0%) on non-food retailing.
Australia has 1,753 shopping venues consisting of department stores, discount stores, factory outlets and specialty shops housing an estimated 65,000 shops. To calculate the total dollar amount spent generated by retail, I had to do some back-of-the-envelope calculations. I added the food retailing ($36.1B) and non-food retailing ($15.6B) and the total is $51.7 billion. I multiplied this amount with the growth rate of 2.39% to arrive at the market size of $52.9 billion.
CONCLUSION
Australia has approximately 235,385 hospitality venues and 1,753 shopping venues. Both industries can expect a healthy growth in coming years that will generate revenues in the billions.
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