Australian hardware retail industry is expected to grow into capital-intensive

According to the IBISWorld research report, despite the decline in consumer confidence and consumer spending tightening, it is expected that the 2011-2012 Australian hardware retailing industry is expected to grow by 2.2%, which is one of the best performing retail businesses in Australia. In the past five years, the industry has grown by 0.3% each year to 11.6 billion U.S. dollars. In the future, the period of low growth in the industry and decline in operating income will end, and the period from growth to contraction may exceed 10 years. In the ten years from 2000 to 2009, the Australian hardware industry’s operating income maintained a steady growth for the first few years, but in the middle to late period, the industry has contracted. The recent growth of the industry is showing signs that the Australian hardware retail industry will return to growth.

Australia's hardware retail industry is low in capital intensity, but it will increase in the next five years. For example, Australian hardware market giants Masters and Bunnings are competing to open more than 200 retail stores.

The capital expenditures of the Australian hardware retail industry are mainly spent on fixtures and accessories such as display racks and cash registers. In the past 10 years, capital expenditures in the industry have increased, mainly due to the introduction and installation of point-of-sale systems that scan product barcodes. This technology not only simplifies work, but also reduces manual errors.