The man who has overseen David Jones' recent revival says the debate about imposing GST on all overseas goods bought online is distracting retailers from improving sales.
Ian Moir, the chief executive of South Africa's Woolworths Holdings, says the Australian dollar's fall, which makes overseas purchases less competitive compared to domestic offerings, is just one reason why companies should focus on customers, rather than fret about the impact of online retail.
"The introduction of any sales tax in any direction only has an impact in the short term and evens itself out over time," Mr Moir said.
"The reality is it set businesses and retailers in Australia back because they spent more time arguing about that ... than they did thinking 'how can I get ahead of the curve, what do I need to do, how can I make sure I'm giving the customer what they're looking for'?"
Several big retailers, including Myer chairman Paul McClintock and Harvey Norman founder Gerry Harvey, have repeatedly expressed frustration that goods bought online from overseas for less than $1,000 are GST free.
Mr Moir, who led Australia's oldest department store to a 6.4 per cent increase in total sales for 2014/15, said a suggestion to drop the threshold to $20 is misguided and that it is up to retailers to innovate and convince consumers to spend their cash closer to home - both online and in stores.
Speaking at an Australia-Israel Chamber of Commerce event in Sydney, Mr Moir said only the biggest retailers have the resources to do that and that he foresees further consolidation in the sector.
"There has to be a reason to go to that store: that it be entertaining, that it's engaging as theatre, that you like spending your time there," Mr Moir said on Wednesday.
"You will see stores of the future be much more interactive, much more engaging and you have to spend money on that.
"There will be fewer (stores) and there will be fewer retailers."
David Jones plans free wifi in all its in-store cafes and the increased use of personalised offers sent direct to smartphones based upon a database of customer habits and preferences.
Craig Dower, the CEO of marketing specialist Salmat, said Australian businesses prepared to innovate were ideally placed to leapfrog overseas competitors given the high rate of smartphone adoption in Australia and overall tech savvy of the country's consumers.
"The loyalty device is in fact your smartphone and we want to try and get access to that," Mr Dower said.
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