Buying video games is detrimental to the Australian economy, right? Well, not exactly, claims Leigh Williams, the founder and CEO of eStore Logistics - who has seen his profits and staff count triple in the last year alone. We spoke to Leigh about the rapidly growing online shopping sector, and how it may end up creating more jobs for Australians in the short and long term.
"Yes, you might have to pay more,” claimed Gerry Harvey. “But it's the right thing to do. You'll pay a lot more if we lose jobs and retailers close down."
Gerry Harvey is talking, of course, about the perils on online retail, and the influx of Australian consumers buying their goods online; regurgitating the standard line that shopping online is the harbinger of our economic demise - that the retail industry will collapse, thousands of jobs will be lost and we, the almighty consumer, will ultimately pay the cost of our online shopping sins with an inflated cost of living.
But does this assertion hold any real weight? And what are the real consequences of shopping online? As avid consumers of video games we generally punch above our weight when it comes to importing goods from overseas – are our actions detrimental to local industry?
Leigh Williams, Founder and CEO of eStore Logistics says no, quite the opposite. By shopping online, gamers are, in actual fact, aiding the Australian economy.
“Gerry Harvey and others will criticise consumers for going out and buying video games online,” he begins, “even if that online store is based in Australia - because there’s this perception that you’re contributing to the closure of regular retailers.
“But just because you’re not actually physically walking into your local EB or JB Hifi, that doesn’t mean you’re not supporting the local industry."
eStore Logistics is a rapidly growing company that helps manage the rapid increase in Australian online shopping – it’s their job is to help eStores like OzGameShop and PlayAsia move product from the manufacturers, to warehouses, to your home. In the past year they’ve grown by 288% - a growth rate that has led to a three-fold increase in staff.
“We work with a number of different online retailers who ship out thousands of products every day to consumers around the country,” he claims. “Just because you’re shopping online, that doesn’t mean you’re not contributing to the Australian economy in some way.
“Increases in online shopping is directly affecting the rise of auxillary industries in Australia – like logistics - just because the jobs are moving from retail, that doesn’t mean they’re disappearing from Australia. They’re appearing in new areas.”
It turns out that, even if you buy video games from eStores based overseas – such as PlayAsia or OzGameShop, you’re still having a positive impact on the Australian economy.
“If you happen to buy from an international web store, the goods have got to get to you somehow,” says Leigh, "and that’s still going through the Australian supply chain once it hits the country.”
Leigh Williams believes that the rise of online shopping has the potential to provide more jobs than retail – in new, rapidly growing industries such as logistics.
“More jobs will be created through the handling,” claims Leigh, “because handling is actually much higher in the logistics department for a consumer order compared to a retail order.
“It creates competition. Australians are getting better value for money and in most cases jobs are being created in other areas where they’re being lost at retail.”
And Leigh Williams’ assertions are being backed up by recent studies. Just two weeks ago the McKinsey Global Institute released a report stating that 21% of GDP growth in mature countries could be attributed to new industries driven by the internet - for every job lost offline, 2.6 jobs are being created online.
These are findings that go directly against the culture of fear being stoked by retailers struggling to adapt to what is essentially a rapid fire siege of competition in a territory where there was no competition before; a territory where, typically, one or two specialist retailers have been privvy to a monopoly over what was sold, and at what price.
Now there is competition, and traditional retailers must adapt to that competition - consumers aren’t suffering and, by all accounts, neither is the Australian economy. There is undoubtedly still a place for Australian retailers, but it’s up to the retailers themselves to work out precisely where that place is.