Communications Minister, Senator Stephen Conroy, has told an event in Sydney that distributors can expect to be hit by big changes thanks to Internet sales and cheap logistics.
The Minister made the comments during an online retail forum in Sydney designed to encourage businesses to develop Internet businesses.
When asked by a journalist if he thought distributors would be destroyed by Internet companies using cheap postal systems to bring in product, Conroy agreed it would have a big impact.
“There is going to be a changing dynamic, particularly in distribution and supply chains so I think that was an important part of the discussion today,” he said. “Do we have a solution yet? Absolutely not.
“As I said this is about beginning the dialogue and no one has a solution yet. There is clearly going to be some change.”
Minister for Small Business, Senator Nick Sherry, also said much of the strain placed on supply chains was due to the rising Australian dollar.
“There’s a multitude of factors here so the Productivity Commission will separate fact from fiction,” he said.
The Productivity Commission is currently looking into a range of issues, including the application of GST on online sales worth less than $1000. It is due to produce a final report for the Government by November, 2011.