No counting, no centre
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Tuesday, 27 April, 1999 - 22:00
AUSTRALIAN shopping centres could become empty shells if centre managers do not pay more attention to accurate customer traffic statistics, says retail performance specialist FootFall managing director John Gallagher.
Mr Gallagher said Australian shopping centres were at least five years behind Europe in measuring customer numbers.
It appears the majority of Australian shopping centres rely on infra-red beams across doorways to measure traffic numbers.
Mr Gallagher said Australian shopping centres risked becoming ‘battlegrounds’ between retailers and shopping centre owners over the issue of rents and customer traffic.
“Anecdotal evidence in the retail sector shows that up to 60 per cent of small speciality retailers in major shopping centres change hands every 12 months — usually due to poor performance combined with high overheads,” Mr Gallagher said.
“The only way to avoid this is for shopping centres to work towards the European model of becoming partners in the success of their tenants and that way both parties win.
“Retailers won’t begrudge paying higher rents in centres that deliver constant high volumes of customer traffic.
“But many centres use such inaccurate methods of counting customers that there is real tension between retailers and landlords.”
Mr Gallagher said Australian shopping centre landlords could not justify the rents they charged retailers without accurate statistics.
“In some cases these figures have an error factor of more than 100 per cent,” he said.
Mr Gallagher said Europeans used accurate customer traffic data to appraise rent levels and determine ‘hot’ and ‘cold’ areas within a shopping centre to greater effect than Australians.
Knowing where these ‘cold’ areas are can help shopping centre’s managers devise ways to heat them up.
Even the Perth City Council takes traffic data into account when considering rentals for tenants in its properties such as the City Station Concourse.
Mr Gallagher said Australian shopping centres were at least five years behind Europe in measuring customer numbers.
It appears the majority of Australian shopping centres rely on infra-red beams across doorways to measure traffic numbers.
Mr Gallagher said Australian shopping centres risked becoming ‘battlegrounds’ between retailers and shopping centre owners over the issue of rents and customer traffic.
“Anecdotal evidence in the retail sector shows that up to 60 per cent of small speciality retailers in major shopping centres change hands every 12 months — usually due to poor performance combined with high overheads,” Mr Gallagher said.
“The only way to avoid this is for shopping centres to work towards the European model of becoming partners in the success of their tenants and that way both parties win.
“Retailers won’t begrudge paying higher rents in centres that deliver constant high volumes of customer traffic.
“But many centres use such inaccurate methods of counting customers that there is real tension between retailers and landlords.”
Mr Gallagher said Australian shopping centre landlords could not justify the rents they charged retailers without accurate statistics.
“In some cases these figures have an error factor of more than 100 per cent,” he said.
Mr Gallagher said Europeans used accurate customer traffic data to appraise rent levels and determine ‘hot’ and ‘cold’ areas within a shopping centre to greater effect than Australians.
Knowing where these ‘cold’ areas are can help shopping centre’s managers devise ways to heat them up.
Even the Perth City Council takes traffic data into account when considering rentals for tenants in its properties such as the City Station Concourse.