Since the 2008 global financial crisis, Australians have been saving at a record-high rate, to the detriment of the country's retail industry. For the September quarter, Aussies' ratio of net household savings to disposable income rose to 10 per cent from 9 per cent in the June quarter.

In contrast, the U.S. personal savings rate was down to 3.5 per cent in November from a 19-year peak of 8.3 per cent in May 2008.

The indicator of how bad Australian bricks-and-mortar retailers were hit was that Boxing Day discounts were increasing. Myer advanced its clearance sale to Christmas Eve for members of its loyalty programme and offered up to 40 per cent price cut on Samsonite luggage. Second largest-chain David Jones discounted Royal Doulton glass sets by 60 per cent and Victoria's Basement in Sydney took off 80 per cent in its clear out inventory.

Although Myer has good and tough days, Myer Chief Executive Officer Bernie Brookes described the industry's current situation as a very challenging trading environment.

In contrast, online shopping went up 37 per cent in the year ended in October. Items bought online now comprise 8 per cent of discretionary retail purchases.

Shoppers explained their shift to online purchases to e-commerce sites offering trendy items such as electronic gadgets, which are popular as gift items for the younger generation.

The weak retail environment not only hit the sales of the stores but also their stocks as they cut their forecasts. Summer clothes retailer Billabong's stocks plummeted 52 per cent in December along with the drop in Australia's summer temperature. Shares of JB Hi-Fi dipped 28 per cent, Katmandu stocks went down 29 per cent, Myer 19 per cent and David Jones 15 per cent.

One solution that finance experts see for some of the traditional retailers such as Harvey Norman - which has a market capitalisation of $1.9 billion and investment property portfolio of $1.6 billion - is to break it up by spinning out the property business. The move would allow the Harvey Norman management to focus on its retail and franchise business.

Other major retailers are also suffering from poor year-end sales, which traditionally account for more than 20 per cent of their yearly turnover.

Experts blamed the continued downward spiral of the country's retail industry to consumers being bored with Australian shopping due to outdated models, limited products available and inferior online shopping sites.

Retailers too have been noticed to rely too much on price offs to attract buyers that it creates a vicious cycle in which consumers would wait for discounts before they open their wallets.

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