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Super Retail Group confident of Amazon rebuttal

Supercheap-Auto-exteriorSuper Retail Group says its investment in omnichannel operations plus improving on customer engagement and its product expertise will help the group survive the arrival of Amazon in Australia.

The operator of Rebel, Supercheap Auto and BCF stores has also pointed to the growth of global sporting, auto and leisure retailers as proof that it can face increasing competitive pressures.

Peter Birtles, Super Retail Group’s CEO, yesterday presented to the Morgan Stanley 2017 Australian Emerging Companies Conference with an analysis of international peers, stating the performance of the group’s international peers in maintaining and growing operating margins despite competitive challenges provides confidence that Super Retail Group’s margin targets are achievable.

“Our analysis concludes that market disruption will not be as detrimental to Super Retail Group as implied by some market commentary,” Birtles said.

Citing Hitwise analysis of the impact of Amazon in Australia, Birtles said with the Auto, Sports and Leisure category spend estimated to be circa two per cent of Amazon sales and if the e-commerce giant achieves sales of $10 to $15 billion in Australia, the spend on the category will be circa $200 to 300 million. This represents market share of two to three per cent of the combined Auto, Leisure and Sports markets.

Birtles says the company’s businesses are strong and well-positioned to respond to disruption. He added the group has been anticipating market disruption for a number of years and its strategy positions the group for continued growth despite the anticipated disruption.

“We have a significant advantage through connecting with our customers with our team members who share their passions” he said.

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