The biggest supermarkets are closing shop.
The big six chains are closing stores, or closing them less aggressively.
The three major chains are struggling to find enough staff.
The supermarket sector is a $US40 billion business and is predicted to contract $US4.8 trillion by 2020, according to the World Bank.
But it’s also a business that’s been battered in recent years, with the cost of goods falling.
The Australian dollar has lost more than 30 per cent against the US dollar since mid-2016, while its cost of living has been hurt by rising costs of food, including food stamps.
And there are fears the industry could be hit even harder by the Trump administration’s move to tax imported goods.
It’s not just Australian retail that’s struggling.
The broader economy is also at risk, with many Australians relying on public transport to get around and jobless rates continuing to rise.
Some retailers have been looking to reduce costs, particularly in the last few years, but the industry still has room to grow.
Australia’s largest supermarkets have been able to cut prices by 10 per cent over the last two years, which has allowed them to grow and expand.
“You’re seeing the impact of that in the supermarket,” Mr O’Neill said.
Mr O’Neil said retailers needed to consider the costs of running their businesses, especially on the margins, rather than just on the front line.
He said it was vital to look at all costs and consider the impacts on staff.
“When you think about how a business operates, you’re always looking at the costs and you’re looking at what you can save by closing the store,” he said.
“It’s a good thing to do but it’s not something we should be doing if you’re going to run a successful business.”