Sunday, 7 October 2018

A Trader's View On Rents

The 2% rent increase for licence holders has resulted in much debate and includes this submission from a trader.

"Forgetting the expectations of traders about a rent freeze and the fact that current sales trends demand a minimising of all costs, let’s instead look at trader rents from a perspective of proportionality.

At this point in time the only proportionality being looked at is the proportion of floor space occupied by licence holders at QVM. And for a long period that meant that the financial contribution of licence holders to the QVM Pty Ltd’s income hovered around 60% of it’s total revenue.

But let’s look at this question a bit deeper.

One of the main reasons given for the increase in rents is based around costs, linked to things like “power, water and waste removal”.
I wonder what proportionality would look like when the cost of each of these is divided into trading groups, I would be very confident saying that licence holders are not consuming anywhere near the proportion of power, water or waste removal costs incurred at the Market.

If we looked at the income generated by Market Traders again I would be astounded if licence holders came anywhere close to generating 60% of the total income generated at the Market.

If we look at Market Promotions and Advertising again the proportionate spend, effort and interest is highly disproportionate and not in favour of licence holders.

If I had the time I am sure I could come up with many more examples of where the ‘contribution’ of QVM licence holders is greatly disproportionate to their financial contribution to QVM Pty Ltd’s bottom line."

9/10/2018 0950 - It has been pointed out that Licence holders do not pay a direct amount for their individually incurred power, water, public liability insurance or council rates. These costs are paid for out of Queen Victoria Market revenue.
Lease holders on the other hand do pay for their own metered electricity, water, council rates and public liability insurance. They also incur a rent increase of between 3 and 5 per cent each year as a lease requirement. - Ed.