Australians seeking to catch a break from the latest Federal Budget will be pleased to see several incentives introduced to kickstart the retail industry, with notable tax breaks offered to small businesses that upgrade their IT systems and purchase new technology.
Within the Treasurer Josh Frydenberg’s budget, small businesses will be able to claim $1.20 tax deductions for every $1 spent on technology, cloud computing and IT infrastructure, up to $100,000.
Welcoming the Federal Budget was Garrison Huang, CEO of Harris Technology which is the largest online marketplace seller of tech products in Australia.
“It’s been a difficult few years for small business operators but with these new incentives to resume spending on tech products, we see a good opportunity for the retail sector to benefit from increasing consumer confidence,” said Huang.
The small business boost comes two years on from the start of the pandemic when Harris Technology first saw a flurry of online purchases for home office products as city-based workers began settling in for remote working from home.
With the increased online activity, there has been a notable increase in cybersecurity risks.
According to the Australian Cyber Security Centre, Australians lost more than $33 billion from cyber crimes. That figure however, only included self-reported losses so the true figure is expected to be substantially higher.
Part of the Federal Budget’s small business boost for technology products also includes cybersecurity and cloud computing, both products that Huang expects will see an uptick in sales in the coming months.
Despite the easing of lockdowns which has enabled city-based workers to return to their offices, Huang expects the hybrid working environment to become a permanent fixture around Australia.
“For a long time, small business customers made up the majority of Harris Technology sales. This is still the case but we’re still seeing a very strong push in home office products being delivered to residential locations as hybrid offices have seemingly become the norm.”
Accommodating this demand where a traditional office has effectively been split in two, with monitors and computer accessories required both in offices and at home, Harris Technology recently underwent a major facilities upgrade. This saw the tech retailer upgrade its warehouse facility to accommodate 50% more inventory, having benefited from the surge in online retail spending since the start of the pandemic.
Unlike traditional retailers, Harris Technology does not operate any retail storefront but is instead one of the largest marketplace sellers in Australia for tech products. With thousands of products listed across Amazon, eBay, Kogan, Catch and other marketplaces, Harris Technology’s marketplace strategy has often resulted in their products being found when customers search for tech products at those aforementioned websites.
This includes holding the ranking of Number 1 seller on Amazon, enabling their products to be featured most prominently.
For the half year ended 31 December 2021, Harris Technology reported $28.5 million in sales revenue which represented a 45.7% increase on the previous year.
Alfred Chan is a Business Reporter at The Sentiment specialising in ASX-listed small cap companies, a bloodstock enthusiast and former equities analyst.
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