Core trading hours are anachronistic; so says Robert Speirs. Since their introduction some years ago, shopping habits have changed, as have lifestyles and even what we shop for. Speirs calls for a new look.
It is time for the industry to start a serious conversation about the regulation of core trading hours. Core trading hours were first regulated back when Paul Keating was Prime Minister; when centres were anchored by Grace Bros, Borders was new and trendy, and video and CD retailers were pumping. Back before the iPhone, online shopping, ALDI, smashed avocado and piccolo lattes.
You would have to have been living under a rock not to have noticed the transformation in the retail landscape since those days. And when I pick up that rock, I find the regulation of core trading hours.
Core trading hours are regulated in all Australian jurisdictions. As is normal with retail legislation, the regulation is similar, but irritatingly different, in the detail. The consistent concept is that a shopping centre can have one set of core trading hours, being the hours during which shops in the centre are required to be open. Once established, those hours cannot be changed without the vote of a majority of shops in the centre.
There appear to have been two justifications for the regulation of core trading hours:
1. To ensure that mum and dad shop-owners could not be enslaved to their stores; and
2. To ensure for the benefit of the public, the Iandlord, and all retailers, that the retailers would be open at the same time, so that the centre had critical mass.
This almost worked well enough in the Keating era, when centres consisted of supermarkets, fruit and veg, a butcher, chemist, newsagent, discount department stores and traditional retail. They opened at 9:00am and closed at 5:00pm, with some opting to trade later.
But it definitely doesn’t work today, in the revolving-door-Prime-Minister-era, now that centres have become lifestyle destinations.
The new generation of centre tenants want to trade late. Dare I say it, but we seem to be moving to a world that gets up later, and goes to bed later.
In fact, for the reason at point 2 above, lessors want to enact trading hours that require the operators in the restaurant precinct to all stay open for the restaurant trading hours.
The only problem is that their centres already have a set of core trading hours, and they are the traditional 9:00am to 5:00pm times.
The lessor could seek to pass a ballot by which it extends the closing core trading hours from 5:00pm to 11:00pm, but this would suit no one. Apart from the horror of organising the ballot, it is likely that the ballot itself could only ever achieve a tweak to the existing hours, not a wholesale overhaul. The traditional retail operators still need the 9:00am to 5:00pm times. The restaurants need 12:00pm to 10:00pm. And not many operators want to trade from 9:00am to 11:00pm. What is really needed is flexibility.
Although it has probably happened, I am not aware of a ballot having ever been taken to change core trading hours. This tells us that the regulation was concocted on someone’s notepad, without any road-test. In practice, it tells us that we probably do not need to regulate core trading hours at all.
If we do, we need to let the regulation breathe, so that centres can have differential core trading hours to back up the way in which retail shopping centres operate on the ground. Heaven forbid that the regulation of the retail industry should pay attention to the way in which the retail industry operates.
Under the present regulations, lessors are required to devise ingenious strategies to accommodate and enforce the myriad of trading arrangements that are the new normal. While these arrangements work after a fashion, they are not ideal. And it is incredibly irritating to have to draft up complicated legal arrangements in order to fit perfectly natural trading arrangements into the anachronistic straight jacket of the regulations.
Yet again, the retail legislation is failing the industry.
The regulation of core trading hours helps no one in the modern world, but snags up the efficient operation of the industry.
Like the minimum five-year term, it is time to roll it back.