Industries in Decline/Trends

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2 yen
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Re: Industries in Decline/Trends

Post by 2 yen »

Some shopping issues that need a resolution / disruption:

Most of the big store (Canadian Tire, Walmart, etc) websites are not user friendly. Until they vastly improve their sites AND offer cheap home delivery, I don't think we need to worry about online shopping truly taking off for them. Delivery is a joke from these companies - if it's offered at all. I see a great business opportunity in our city for someone with 2 or 3 smallish vans that will do same day delivery for a small flat fee. I guess that culture just doesn't exist here like it does elsewhere. I would add that many people appear to be willing to go online to order and pay for same day or next day grocery delivery, including fresh produce. I would happily pay for this service. Problem is that it simply doesn't exist where we live. And another thing that annoys me is a store website that says I can order and pay online then go to the store to pick it up. Bizarre.

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big easy
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Re: Industries in Decline/Trends

Post by big easy »

What about bricks and mortar Universities. I just don't see the need for all those fancy buildings and tenured professors, when the content can be delivered on line for a fraction of the cost.
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Re: Industries in Decline/Trends

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If people think that sitting behind a computer screen and clicking is going to be the only way to buy things in the future they are dreaming in technicolour. Enough of the working world spends their time like that and even a retired person like myself.
But people like the feel and look of goods not their digital photos. Many enjoy shopping or the social aspects of a visit to the mall. Personally I dislike shopping and research the product, in and out is my style. With Christmas upon us the malls will be full ( US Black Friday approaching).
My seniors hiking group is often in a mall at the start or a lunch break and there always seems to be a group of locals having their regular chat or coffee there..
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Re: Industries in Decline/Trends

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What about bricks and mortar Universities. I just don't see the need for all those fancy buildings and tenured professors, when the content can be delivered on line for a fraction of the cost.

Shhhhh! Tenured Professor here! :)

Actually, some of this is already happening. You can do many courses online, and in Asia, people can get English conversation lessons through sites like Skype, rather than pay $$ for private or group conversation lessons in schools. Proofreading, editing and translating are also quite mobile. I recently used the services of a certified translator in Canada who was charging a fraction of the cost of the same service in Japan: just scan and email the docs.
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Re: Industries in Decline/Trends

Post by ghariton »

CROCKD wrote:If people think that sitting behind a computer screen and clicking is going to be the only way to buy things in the future they are dreaming in technicolour.
I don't think that on line retail shopping will completely replace bricks-and-mortar. But I do think that enough people will switch over for enough products to have a fairly large impact. And with profit margins being what they are in retail, I think many businesses will be folding. The main reason for many young people to visit physical stores is to eliminate delivery time. But the on-line sellers are working on same-day delivery.
Enough of the working world spends their time like that
From where do you think that they do their on-line shopping? :wink:
But people like the feel and look of goods not their digital photos.
Some, like myself, find the online reviews even more helpful. And if you have done your searches online, what is more natural than to complete the transaction online?
Many enjoy shopping or the social aspects of a visit to the mall.
The social aspects of a mall may be important to the community, but generally they don't generate revenues.

The closest shopping mall to me is full of retirees, sitting there hour after hour. Sometimes they buy a coffee, but then they make it last and last. The latest mall manager has started taking measures to actively discourage seniors from doing that, e.g. reducing the number of seats.
My seniors hiking group is often in a mall at the start or a lunch break and there always seems to be a group of locals having their regular chat or coffee there..
Indeed.

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Re: Industries in Decline/Trends

Post by JaydoubleU »

Hospitals: This is a tough one, but home care, preventative care, and sufficient nursing home care might make continuing investments in hospitals unjustifiable.

Wow. That's a tough one indeed. I'm going to run it by my MD sister and see what she thinks.
We have an answer here from a physician currently practicing in Ontario:
I do think so much more should be done in the community; we definitely need many more nursing and retirement homes...preventative care is key...there will always be a place for hospitals...but many of our beds are filled up with folks who don't need acute care..they need nursing homes and they are too frail to return home; they sit in a hospital bed at enormous cost to the system...
I think a lot a care can be done by communities but certainly NOT all of it.
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Re: Industries in Decline/Trends

Post by scomac »

ghariton wrote:
Many enjoy shopping or the social aspects of a visit to the mall.
The social aspects of a mall may be important to the community, but generally they don't generate revenues.

The closest shopping mall to me is full of retirees, sitting there hour after hour. Sometimes they buy a coffee, but then they make it last and last. The latest mall manager has started taking measures to actively discourage seniors from doing that, e.g. reducing the number of seats.
That's one way of approaching it, but some choose to embrace this desire and initiate programs to encourage seniors to visit in the hopes that there will be spin-off sales. A local Walmart that hosts a seniors walking group at 7 am daily offers free coffee at the in-store McDonald's to the participants.

You can either chase away potential customers as an annoyance or try and entice them to spend some more of their money at your location. Perhaps there's more to Walmart's success than simply low prices!
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Re: Industries in Decline/Trends

Post by peter »

big easy wrote:What about bricks and mortar Universities. I just don't see the need for all those fancy buildings and tenured professors, when the content can be delivered on line for a fraction of the cost.
Regardless of need for buildings or professors, universities aren't exactly a golden investment opportunity. The ones that were investment opportunities in the US were/are basically scams designed to move federal student support from students to their owners.
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Re: Industries in Decline/Trends

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scomac wrote:You can either chase away potential customers as an annoyance or try and entice them to spend some more of their money at your location. Perhaps there's more to Walmart's success than simply low prices!
Yes.

My information is somewhat dated, but I remember studies that show young people spending much more per capita than seniors. Many of the programs launched by retailers seem to be launched at children (and their parents) and adolescents. As well, it's nice to be seen as a good community citizen, especially if you're a company that has been as controversial as Walmart.

But all this is anecdotal. Builds on Peter Lynch's suggestion that one's investing should be guided by one's experience as a customer. But while that might have worked in the 1980s, I don't think it works any more.

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Re: Industries in Decline/Trends

Post by kcowan »

Online shopping
There is a major difference between the US and ROW in infrastructure. 30 years ago, you could order furniture from NC and have it delivered in a couple of days. If you did not like it, returns were easy. This was with catalogs. The evolution to online has just capitalized on that delivery infrastructure.

I think Best Buy has evolved the model well in Canada. Pick it up locally or wait 2 days for delivery.

Disintermediation
Any business that can reduce costs by making the client do the work will be threatened. Travel agencies are a leading example. They survive on booking cruises now. And there are many fewer of them. Brokerage will be another one. As they get regulated into divulging their real costs, discount operations will flourish.

New Services
Uber and Airbnb are just leading examples of businesses made possible by online.
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Re: Industries in Decline/Trends

Post by Chuck »

JaydoubleU wrote:
Hope you wrong. Pot is a evil disaster for teens and young people.I wouldn't want one penny of profit from this destroyer of young people.
I've been having this debate online elsewhere. Although I am in favor of legalization, I think the regulations are going to have to be discussed and debated much more. I don't agree with some people that MJ is harmless, but nor do I think it is a scourge worse than alcohol.
Jayw echoes my feelings on the matter. No worse than alcohol and it's already in widespread use. However, unlike alcohol and tobacco in the current situation there are no lucrative "sin taxes" going to the government, nor income taxes (from both corporations and would be investors), which could presumably be used for 'social good' since the industry is currently in the hands of criminal enterprises.

So I am a big fan of legalization of marijuana, and would have no qualms about attempting to profit from it. It's just another product with a strong consumer demand as far as I see it.
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Re: Industries in Decline/Trends

Post by Koogie »

I spent a long lunch today with a friend who is a muckety muck in mall leasing. He has worked for several publicly traded Canadian REITs and I was looking forward to hearing his opinion on retail and commercial leasing. Especially since I own VRE and SRU.un.

He has recently moved down market from Tier 1 properties to Tier 2 and Tier 3 properties. They are experiencing a significant vacancy rate and strong pressure on square footage rates at renewal time. Additionally, they are trying to maintain an enticing mix of retail tenants in certain properties and having to offer deals to anchor and showpiece clients to preserve that appeal. Since they work on 3 to 5 year lead ins, they have to try to forecast for that time period and adjust accordingly. I can't believe they are much more prescient than the rest of us but they do certainly have more at stake.

Bottom line is that low and mid level properties are beginning to suffer and are expected to continue to do so. High level properties are fine and they believe they may even prosper. Witness in the GTA the cranes and construction visible at Sherway and Square One, for instance.

I don't necessarily agree as I believe that a lot of the high end spending is powered by lines of credit and low interest rates and those can't last much longer (relatively). But the question is how much longer that can run. I have a decent amount of cash built up in our TFSAs. I'm not sure I'll be adding to SRU based on our discussion (in view of its client mix)

YMMV.
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Re: Industries in Decline/Trends

Post by JaydoubleU »

I was just curious. Online shopping has hurt the brick-and-mortar retail sector, but it has been a boon to delivery companies.

Has anyone here ever had a delivery from a drone?
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Re: Industries in Decline/Trends

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Jayw echoes my feelings on the matter. No worse than alcohol and it's already in widespread use. However, unlike alcohol and tobacco in the current situation there are no lucrative "sin taxes" going to the government, nor income taxes (from both corporations and would be investors), which could presumably be used for 'social good' since the industry is currently in the hands of criminal enterprises.
I am in favor of it for exactly that reason (put the criminals out of business), however my point was that I DON'T think it is quite the harmless and safe drug that some online supporters make it out to be. I have seen enough of it to know that if it is potent enough, it won't agree with driving, operating machinery, sports or studying; and I'd worry about a generation of kids observing stoned parents and thinking, "Cool, let's check this out," which is what me and my friends did with cigarettes when we were 12.
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Re: Industries in Decline/Trends

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I personally wonder what criminal organizations will move to if they lose the concession on pot. Fear for the worst and hope for the best.
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Re: Industries in Decline/Trends

Post by Hammerer »

JaydoubleU wrote:I was just curious. Online shopping has hurt the brick-and-mortar retail sector, but it has been a boon to delivery companies.

Has anyone here ever had a delivery from a drone?
As with most comments here, nobody is positing that these industries, like retail, will disappear entirely, but they could become a shell of their former selves. There will be those that want to go to B&M, but as online becomes the cheaper and cheaper alternative, B&M will have to raise their rates because their fixed costs aren't spread around as much. That, or rents will crater. I'm already buying items from Ebay direct from China at 1/3rd the Walmart price.

I think drones would be great for dropping a pizza off on my balcony, but overall, they're very inefficient. At best, I could imagine a truck driving around with multiple drones taking off and landing on it, without it having to park.

Amazon is already moving to Uber-style couriers, and Hermes has existed in Europe as a courier that contracts deliveries out to people driving their own car.
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Re: Industries in Decline/Trends

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Shopping at bricks and mortar stores is dead? .... Amazon doesn't think so:
Rumors have been brewing for about a year now that e-commerce titan Amazon.com wants to open grocery-centric brick-and-mortar locations. In Seattle and Sunnyvale, Calif., there have been reports that outposts are in the works allowing shoppers to drive up and retrieve grocery orders they place online. On Tuesday, the buzz grew louder when the Wall Street Journal reported many such locations are in the works, and they will not only include curbside pickup, but also walk-in convenience stores where you can purchase perishables.
The entry into brinks and mortar grocery stores follows Amazon's opening of bricks and mortar bookstores:
This week, Amazon revealed the location of its second brick-and-mortar bookstore, which will open in a few months in Southern California, at a mall near the University of California, San Diego. The online retailer seems to have big ambitions for its physical stores.
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