Harvey Norman needs to get with the program

[BayView]

Gerry Harvey is a crybaby capitalist of the worst kind.

I don't think he's being a cry-baby; just stating the current state of play.

He just happens to be one of the most vocal about things in retail.

When you're the biggest you can do that.

I'm sure he could take a few hundred million hit and still buy us all out.

 

[Rolf Latham]

I don't think he's being a cry-baby; just stating the current state of play.

He just happens to be one of the most vocal about things in retail.

When you're the biggest you can do that.

I'm sure he could take a few hundred million hit and still buy us all out.

He also doesnt mind saying it like it is ( in his view) diplomacy isnt his strong point, and at least to date, it hasnt hurt him too much.

As others have said, SS, bu is very nature isnt representative of the normal folkout there, and what we feel or think about retail vs online doesnt really matter ?

FWIW I buy almost ALL my IT gear forour small biz online, xcept custom built servers

ta
rolf

 

[Fifth]

I don't think he's being a cry-baby; just stating the current state of play.

He just happens to be one of the most vocal about things in retail.

When you're the biggest you can do that.

I'm sure he could take a few hundred million hit and still buy us all out.

He doesn’t simply state the current state of play, he uses very emotive and moralistic language.

At one point he was accusing online shoppers of being ‘unAustralian’. Funnily enough, he never accused us of being unAustralian when we bought his foreign-made wares. He doesn’t care about jobs, he just peddles the routine to guilt us into shopping at his stores.

He’s fond of complaining about the unfair playing field of traditional retail versus online, but I never once heard him complain about the unfair playing field of small business verses the retail giants (eg. Harvey Norman).

Business isn’t fair and he was fine with that when things were going his way. Now that his profits are slipping, it’s all outrage and moral indignation. The very definition of a crybaby capitalist.

And of course he’s far wealthier than anyone on this forum could dream of being, that’s why I find it insulting when he accuses us of being unAustralian and not caring about jobs because we’re not shopping at his stores and making him even wealthier.

 

[Crabnet]

Could be a trend; I've seen a number of "quality" retail shops vacate the Mall environment, to be replaced with massage shops (real ones) and "reject" or $2 -type shops.

Yes just looking at the Stockland results they have rejigged their retail mix for their centres. Less fashion stores with a higher percentage of the remaining clothing stores at the value end. More cafes and services.

He doesn’t simply state the current state of play, he uses very emotive and moralistic language.

At one point he was accusing online shoppers of being ‘unAustralian’. Funnily enough, he never accused us of being unAustralian when we bought his foreign-made wares. He doesn’t care about jobs, he just peddles the routine to guilt us into shopping at his stores.

He’s fond of complaining about the unfair playing field of traditional retail versus online, but I never once heard him complain about the unfair playing field of small business verses the retail giants (eg. Harvey Norman).

Business isn’t fair and he was fine with that when things were going his way. Now that his profits are slipping, it’s all outrage and moral indignation. The very definition of a crybaby capitalist.

And of course he’s far wealthier than anyone on this forum could dream of being, that’s why I find it insulting when he accuses us of being unAustralian and not caring about jobs because we’re not shopping at his stores and making him even wealthier.

I'm pretty sure he'll get over the unfair practise that gives overseas retailers an unfair advantage over local stores by them not having to charge GST or factor in duty to their prices. IMHO that is what the coalition of retailers considered unAustralian not the people actually buying the goods. But that wouldn't stop the headline copywriter deliberately misquoting them for the clicks.
He'll reduce floor space for no/low margin goods, sell those from overseas himself, if he wants to and concentrate on other areas of higher margin sales. IIRC next year he's going to be entering solar pv in a big way.

 

[Fifth]

I'm pretty sure he'll get over the unfair practise that gives overseas retailers an unfair advantage over local stores by them not having to charge GST or factor in duty to their prices. IMHO that is what the coalition of retailers considered unAustralian not the people actually buying the goods. But that wouldn't stop the headline copywriter deliberately misquoting them for the clicks.
He'll reduce floor space for no/low margin goods, sell those from overseas himself, if he wants to and concentrate on other areas of higher margin sales. IIRC next year he's going to be entering solar pv in a big way.

The coalition of retailers were just annoyed that other businesses exploited the 'unfair' advantages of online shopping first. It had nothing to do with supporting Australian businesses or jobs or giving anyone a 'fair go' or any of the other nonsense buzz terms the coalition threw about. If they'd had the foresight, they'd have exploited the unfairness in an instant.

Here's an interview with Harvey from 2008:

Despite a growing number of Australians purchasing goods over the internet, he says online retailing is “a complete waste of time”.

“I’ve got an online part of my business, but I definitely would not put more into it. That’d be a recipe for a disaster.”

“Online people do not make any money,” Harvey also told SmartCompany. “The whole world was conned with online retailing. People say I’m a dinosaur, and I’ve had people coming to me with sites and saying, ‘Oh, look at this, they have 10,000 or 20,000 hits!’ – but it’s a con, a complete con.”

Over 57.9% of Christmas shoppers say they will use the internet to research and compare products, new Australian Retailers Association research says. But Harvey says online retailing is still “a waste of time”.

“Go and check and find out who is making money in the online selling business that you can say is worthwhile. You give me a list of 10 online retailers that are making money, and then we’ll talk. Not just $200,000 or $300,000, but real money.

“Sure, it has a future, but the problem is it costs a lot of money to do it properly. There’s an awful lot trying, though. If you said to me in 50 years will people be successful, then yeah, but mostly not now.”

http://www.smartcompany.com.au/retail/why-online-retailing-is-a-dead-end-gerry-harvey.html

Before he realised online shopping was nibbling away at bits of his pie, he not only didn't complain about the unfairness of it all, but dismissed online selling as too costly a venture.

 

[Rolf Latham]

If they'd had the foresight, they'd have exploited the unfairness in an instant.

nuff said

ta
rolf

 

[turk]

Spent some time tonight talking to a senior person at a privately owned Australia wide retail clothing chain, this financial year total turnover up 38%, made up of store T/O +18%, online T/O +112%.

Young dynamic company moving with the times.

 

[BayView]

Spent some time tonight talking to a senior person at a privately owned Australia wide retail clothing chain, this financial year total turnover up 38%, made up of store T/O +18%, online T/O +112%.

Young dynamic company moving with the times.

We all know how this can work; moving to online trading.

The companies that embrace it will do well most likely.

As I said; Gerry couldn't really care; he's a zillionaire and moving into later life. He's already moving to on-line business.

The problem as I see it - and I'm sure Gerry Harvey does as well - is the ramification for Aus is the loss of jobs.

Maybe some will be replaced with staff who administer the on-line business instead of walking the floor and standing behind the counter in the retail outlet.

The interesting equation will be how many will be needed for online business versus how many go from the retail outlets?

And the other question is where will those ex-retail staff go for work?

Hey; the mines are hiring.

 

[pennyk]

i've just spent a few 1000 at harvey norman... i didnt realise how long it been since I'd shopped there. but i needed new furniture, and was tired of fantastic furniture foam deteriotating in the first 6 mths... but they didnt have records for me, so its over 8 years since i've actualy bought anything there.
we bought lots of sales items.. a 5 seater (4 reclining) lounge suite, sofa bed, dining table, coffee and display table, a TV stand, and a few other bits and pieces. i was pleasantly surprised by the prices. I wasnt buying premium items and they were on sale. but i think it was $5-6ooo in total.

i was happy with service in furniture as well... except that the guy who had served us well in there couldnt continue that service in electrical, where we planned to buy a new TV.... you'll notice no TV on that list.

 

[buster]

AN

i've just spent a few 1000 at harvey norman... i didnt realise how long it been since I'd shopped there. but i needed new furniture, and was tired of fantastic furniture foam deteriotating in the first 6 mths... but they didnt have records for me, so its over 8 years since i've actualy bought anything there.
we bought lots of sales items.. a 5 seater (4 reclining) lounge suite, sofa bed, dining table, coffee and display table, a TV stand, and a few other bits and pieces. i was pleasantly surprised by the prices. I wasnt buying premium items and they were on sale. but i think it was $5-6ooo in total.

i was happy with service in furniture as well... except that the guy who had served us well in there couldnt continue that service in electrical, where we planned to buy a new TV.... you'll notice no TV on that list.

Harvey Normans sale prices are dearer than normal price, bought a lounge chrismas eve once for $1200 at HN no sale no bargaining just walked in saw it and said I would take it. 2 days later in the post chrismas sales it is promoted in huge sale at $1300, discounted from normal price of $1800 ???
Another time they had a had a one day only huge discount on fridges, but the price was $200 dollars more than any-one elses normal price. Same thing happened with another lounge suite I saw once decided about a week later to go back and buy it but the price had gone up $200 dollars, as it had gone on sale. I think this might be HN problem becuase I never buy anything on sale now and never buy at harvey norman.

 

[Aaron Sice]

The problem as I see it - and I'm sure Gerry Harvey does as well - is the ramification for Aus is the loss of jobs.

Maybe some will be replaced with staff who administer the on-line business instead of walking the floor and standing behind the counter in the retail outlet.

The interesting equation will be how many will be needed for online business versus how many go from the retail outlets?

And the other question is where will those ex-retail staff go for work?

this is GH's actual problem - believe it or not, he does actually have a heart and cares about his staff and their future prospects.

now, his middle management might not give a toss, but having heard GH speak, you get a sense that the last thing he wants to do is downsize anything and incur layoffs.

online businesses - at the size they are, will need everything from warehouse staff, security for said warehouse, IT operators, accountants, bookkeepers, delivery people, product acquirement people......

if GH put as much effort into online sales as he does face2face sales, then i have to say, in australia, he could give amazon a run for their money.

 

[Crabnet]

this is GH's actual problem - believe it or not, he does actually have a heart and cares about his staff and their future prospects.

now, his middle management might not give a toss, but having heard GH speak, you get a sense that the last thing he wants to do is downsize anything and incur layoffs.

online businesses - at the size they are, will need everything from warehouse staff, security for said warehouse, IT operators, accountants, bookkeepers, delivery people, product acquirement people......

if GH put as much effort into online sales as he does face2face sales, then i have to say, in australia, he could give amazon a run for their money.

To put some perspective to bricks and mortar stores in Australia with an online presence. I remember a head of JBHiFi, (HN's major electronics competitor) answering a question about online sales. He said that their online division was equivalent to one maybe two good B&M stores. They have about 160 B&M stores in Australia but I don't know how many of those would be classed as good.

As far as Amazon goes I'm not sure if Harvey would be comfortable having a business structure like theirs which avoids state taxes and federal taxes as much as possible. The same way eBay and PayPal pay little tax in Australia by operating out of Luxembourg.

 

[Ausprop]

I read that amazon are coming to australia anyway as a springboard for asian distribution - it will turn our retail economy upside down if it is anything like amazon US, however I imagine it could only ever be a watered down version, for some reason aussie prices are always double+ what the rest of the world pays. has a lot to do with distribution rights

 

[BMan]

i shop there quite a bit
there prices are expensive but if you go in there knowing what you want to pay its pretty easy especially if you have a good sales person.
i bought a fridge, online price ex delivery was $1600 they had it for $1900 (and were most expensive retail price in all the shops i went to) but just asking best price at all shops i got to 1600 without even showing online price
then went to harveys and they offered 1800 i said you have to beat 1600 and i got it for 1540 + free delivery

i find dick smiths wont budge on pricing

 

[depreciator]

To put some perspective to bricks and mortar stores in Australia with an online presence. I remember a head of JBHiFi, (HN's major electronics competitor) answering a question about online sales. He said that their online division was equivalent to one maybe two good B&M stores. They have about 160 B&M stores in Australia but I don't know how many of those would be classed as good.

I'm suprised at that. JBHiFi has a product mix perfect for on-line sales - much easier to mail DVDs than fridges.

 

[Aaron Sice]

WalMart are looking to open here too - i doubt they'll get the same economy of scale they get in the US.

 

[oracle]

I'm sure he could take a few hundred million hit and still buy us all out.

See attached chart...may be today but if Harveys last 10yrs stock returns are repeated over the next 10yrs I think someone will buy him out than the other way round.

And the other question is where will those ex-retail staff go for work?

Where did all the ex-banking staff go when Banks reduced branches as they introduced ATMs, Internet banking?

Where did all the ex-manufacturing staff go when they lost their jobs to the low cost manufacturing in China?

Where did all those ex-call centre and ex-IT staff go when they lost their jobs to offshoring to India?

You get my point?

Unemployment figures released recently showed Australia's unemployment rate at 5.2% which is close to full employment.

When jobs are lost in one industry due to whatever reason, new jobs are created in new and emerging industries. This has been going on for decades may be even centuries. New industries are created as we humans continue to innovate and increase productivity. Change is inevitable, whether we like it or not.

Cheers,
Oracle.

 

[Crabnet]

I'm suprised at that. JBHiFi has a product mix perfect for on-line sales - much easier to mail DVDs than fridges.

Yes as Gerry said for large businesses like theirs the online is tiny. People buy dvd's online for the cheapest price they can search out. There would be no loyalty to a particular supplier.
Just found some JB figures to Dec 2012.

http://www.current.com.au/2012/02/13/article/JB-Hi-Fi-CODB-up-for-first-time-in-7-years-online-booming-grey-market-growth/IAAORGZDLZ

"JB reports that, on average, its website has 957,000 visits per week, with that figure jumping to 1.4 million during the busy Christmas period. Despite these impressive figures, online sales only accounted for $25.7 million, or 1.4 per cent of total sales. Current.com.au understands that JB Hi-Fi’s online conversion rate (total visits divided by sales) is one of the lowest in the electronics industry.

 

[Tony3008]

Another plus for retail stores which I don't think has been mentioned is the near instant fulfilment - see it, decide, take it home. Mail order works best if there is someone around to accept deliveries, which in my case is not often.

My experience of HN Highpoint is that the service is dire. When I bought my noise reducing headphones the cashier and another staff member stood there chatting for about five minutes, ignoring the fact that I was waiting to pay. When she finally condescended to serve me, she acknowledged this and knocked $25 off, which represents quite a good hourly return! More recently I left a $400 video camera on the counter and walked out as there was no likelihood of being served within the next ten minutes - long queue and only one till in operation. Paid $10 more at GG with prompt friendly service.

 

[Tuppence]

My experience of HN Highpoint is that the service is dire.

Hear, hear. Two recent experiences there - went to buy an iPod Touch (c$200) - no service. Walked out.
Went in yesterday to buy a standalone oven and rangehood for our kitchen reno, and potentially a fridge (c$4500?). No service. Walked out.
I can tell Gerry Harvey, it's not just prices that make people shun Hardly Normal.
Also, what he doesn't mention in his rants about online shopping and GST and such is that he and his wife are major players in Domayne, which does an awful lot of business online. Seems Gerry would like to have his cake and eat it too.