World of opportunity for regional Australia
Rush from the cities creating a new life
THE great Covid tree change is creating new opportunities for regional businesses as Aussies flee capital cities and bring their skills and their wallets further afield.
Exclusive research from data and insights platform Dynata reveals more than a third (37 per cent) of metropolitan Australians have considered moving to a regional area during the pandemic, and one in six of these have committed to a move.
But many more have gone beyond daydreaming, with 45 per cent researching where to live, 19 per cent applying for jobs, and 20 per cent asking their current employer for permission to work from a different location.
While some tree changers just want a temporary reprieve from capital city restrictions, most (66 per cent) hope to make a permanent move away from the hustle and bustle of the city.
ADDRESSING SKILL SHORTAGES
Mars Wrigley Australia general manager Andrew Leakey said there was a particularly strong appetite from younger Australians to move out of metropolitan areas, but it was up to regional employers, governments and educators to showcase the careers available in regional businesses.
The chocolate and chewing gum manufacturer’s own research showed almost four in five (79 per cent) millennials had considered a regional relocation and about threequarters (74 per cent) reported Covid-19 as an influencing factor in their decision.
Mr Leakey called on regional communities to implement “bold and visionary initiatives to position themselves as attractive destinations” for city dwellers.
Mars Wrigley employs almost 700 people in regional and outer-city areas, including in Ballarat in Victoria.
“Traditionally, people in Ballarat go to Melbourne for university so then stay in the bigger cities, but what we are finding is that, with the right programs, you can show people what a career (in a regional area) looks like,” Mr Leakey said.
Global futurist Anders Sorman-Nilsson said that although many recent tree changers and sea changers would continue their city jobs as remote employees, many of these would eventually end up in local businesses too.
“Once talent migrates into regional communities and they get a taste for the place, they might decide ‘it’s great to be a laptop jockey but it would be nice to start engaging with the community’ and they see there are big employers in the regional towns,” he said.
“You may see people keep their connectivity to their old employer, but in a year or two they explore the local employers … and it will go some way to addressing the skill shortages in Australia’s local communities.”
GROWING POPULATIONS INCREASE CUSTOMERS
Populations outside of greater capital cities increased by
more than 11,800 in the March 2021 quarter due to internal migration alone. This was the largest shift since the ABS began the series 20 years ago – surpassing the previous record in the September 2020 quarter. And more people means more customers.
Nicholas Blackburn, 32, was living and working in Melbourne when the pandemic hit but moved to Townsville, Queensland, earlier this year.
He took a remote role with Adelaide-headquartered game developer Mighty Kingdom, working as the programming lead for phone app Gabby’s Dollhouse.
“After spending nine months indoors working remotely for an office in the same city, you kind of wonder why you’re paying the rent you are when you could just as well be out on the beach in a three-bedroom house at half the price,” he said.
NEW BUSINESSES LAUNCHING
Start-up expert and director of partnerships at HR software company Compono Raife Watson said a significant portion of new businesses created since the Covid-19 outbreak were in the regions.
“Sometimes it’s a city person who moves to the country and they get there and go ‘what am I going to do?’,” he said. “They might start up things that are in the city but aren’t in the country – such as high-end bakeries.”
Strong Pilates co-founder Michael Ramsey said he had received a lot of franchise inquiries from people in regional areas.
There are 12 new studios opening soon, including in Thornton and Newcastle in NSW, Tasmania’s Launceston, and Queensland’s Gold Coast and Sunshine Coast.
“A lot of the people contacting me have moved from the city to the regions,” Mr Ramsey said.
different to ours as well ... and also they have a lot of growth opportunities and we think we can roll out 90 to 100 stores,” Mr Scali said.
“The Plush business demographic is more mid market, they are 1000sq m stores and that is easier to do, it just does sofas which is easier to manage. It will also give us much more volume when added to our business.”
At Nick Scali around 70 per cent of its business is drawn from sofa sales whereas for Plush it is 100 per cent, Mr Scali said.
It had been speculated for a number of months that Nick Scali was in the market for an acquisition with its elevated share price a handy war chest to scoop up a deal.
Plush has 46 showrooms across Australia and in the 2021 financial year it posted revenue of $160m and underlying earnings before interest, tax, depreciation and amortisation of $27m, up from revenue of $111m and underlying EBITDA of $10m a year earlier.
Michael Ford, executive chairman and chief executive of Greenlit Brands said the business was “very pleased” to have negotiated the sale of Plush to Nick Scali.
Nick Scali shares surged 10.4 per cent to $12.12.