Retail Perspective on Federal Budget 2023

Targeted relief to support businesses and households

The 2023/2024 Federal Budget has a clear focus on delivering cost of living relief measures for both businesses and households.

The Government’s focus on small businesses through tax relief in energy efficiency and electrification investments, $20,000 instant asset write-off and power bill rebates will help small retailers to reduce their costs.

Despite the consensus that inflation has passed its peak in Australia but remains high, many households will continue to feel financial pressure and cut their spending on non-essential purchases.

The Government has also taken measures to make life cheaper for Australians with lower childcare fees and the announced energy bill relief plan aimed at reducing household bills.

However, we expect that consumer groups will continue to respond differently to the financial and economic challenges depending on their spending habits, generational and income levels.

Retailers will need to focus on understanding these consumer groups and tailoring their products and services to meet their specific needs. In this environment, quality loyalty programs that offer real value and personalised customer journeys will be what drive traffic and sales.

BDO's Federal Budget Analysis