Gerry Harvey’s business has a tough time and he’s like the school kid in trouble trying to get you to look at the other kids rather than focus on him.
You are now seeing more retailers go broke and out of business than I have ever seen in my life.
That’s a quote from Gerry Harvey published yesterday by the ABC. He’s more extensively quoted in The Age this morning.
Gerry Harvey needs to stop talking down retail and news outlets need to stop letting him get away with this.
Harvey Norman’s poor figures are theirs to own. They need to accept the situation and address it and not suck up space and air time talking about other retailers.
Okay, retail is tough. But there are plenty of good stories, stories of same store year on year growth. Especially in the small and independent retail area where the owner of the store runs the store and where there owner of the store lives and breathes essential customer service knowing that the buck stops with them.
The Harvey Norman stores are from an old retail model where customers were treated like mugs and they got away with it. His shrill advertisements made it sound like his prices were great when they really weren’t. He pitched interest free finance but was it really?
I don’t remember Gerry Harvey every spruiking a point of difference which he could own. Anyone can win on price. Anyone could negotiate with a finance company for ‘interest free’ financing. Today’s shopper armed with the ability to easily compare price can see that Harvey Norman is not as cheap as their ads make out.
Price is not a valuable differentiating factor for a retailer.
Had Gerry invested in genuinely good customer service and relationships which were embedded with the local community he might have had goodwill on which he could rely. But, no, he thought it was about price (even though his prices were not that good).
The lesson from the Harvey Norman problems is that customer service is king in retail. It drives repeat traffic and with repeat traffic you drive cash flow and cash really is king.
Retail is in the middle of the most significant paradigm shift in decades. Gerry Harvey’s model is struggling to navigate this.
I see more newsagents and other independent small business retailers embracing more change every month than Gerry and his business achieve in a year. That’s because our livelihood in small businesses is on the line every day. With Gerry and probably the directors of his company the food on the table is covered by other investments and assets. They are not acting like they are fighting their their business. They have become lazy.
That’s why Gerry complains so much about online and GST on imports. He wants other people to own what is really his problem.
Many small and independent retailers have just the one core asset, their business. No wonder they are smarter.
I’ll delve more into this issue at the Newsagency of the Future Workshop series next month.
This is not the first time you have singled out Gerry Harvey Mark, I wonder if you two have a personal difference?
We need a person of his standing to stand up for retailers and to tell it like it is, everyhing is NOT OK, it has been “tough” for too long now for it to be OK, and we need someone who matters to talk about this.
The car industry cried poor and the minister rang the CEO of a car company and gave help, the miners cried poor and the minister called on the big miners and they got changes, the clubs cried poor and the big clubs got changes but who have retailers got with any clout if not Harvey?
If bluescope sat back and kept quiet they would not have an extra few million sitting in the bank thanks to taxpayers, it is called lobbying and we need more people doing it in order to make a difference, just like your twitter army Mark.
It’s great to look at the positives but to simply grit your teeth and bear the negatives is not helping, if customers honestly understood how bad things are in retail then maybe they would show more loyalty to local operators.
We will outlast this doom, because like you stated some of us have no other option, but it is good to have a Gerry Harvey on the side of retailers.
No personal difference Luke.
If you listen to Gerry, retail is headed to a grave. Well, no it is not. His company released a bad set of numbers. he should concentrate on that and not point to the rest of retail.
General retailers on shopping centres were up close to 4% year on year last year. Gerry would know that. But, hey, why indicate there may be good news when it is bad news which supports his case.
Gerry Harvey is not on the side of retailers. He is on Gerry’s side … as he should be as the Chairman of a public company.
seasonally adjusted retail sales grew only 0.3% in January Mark, and in NSW they fell 0.1%, these numbers across the board are cause for alarm given last yr we were all hit with floods. unless we get some real help from either the Govt or RBA retail will consist of Coles or Woolies and very little else. If you read this companies outlook “Harvey “Norman chairman Gerry Harvey was upbeat about the company’s prospects in relation to other retailers.
He said the company had a property portfolio valued at $2.12 billion which provided strength and stability to its balance sheet.”
He is not talking retail into the grave simply calling it like it is instead of whitewashing it like the Govt is doing by saying the economy is strong by hiding behind the mining boom, not just retail but house prices are falling through he floor, A$ is way above what it should be which is killing local manufacturers.
Consumers need to be told that if they do not start supporting local operators then there will be very few left, but at the moment they are being told everything is OK and it is just retailers whinging.
Luke you’re talking about different figures to me. You can’t lump all retail together.
Bashing consumers and talking down all retail is not smart but it suits Gerry Harvey’s needs in the context of his problems.
Any retailer thinking that declining sales are a consumer problem is wrong.
Mark I agree with you. Gerry is only looking after his own interest. Instead of focusing on the negative look at the positives. Small business have great opportunities because we can are more fexible and able to adjust our busineses to suit. Bring on the change.
Have to agree that times are not so good at the moment, and the economy is being dressed up by government spin.
Gerry Harvey seems to be put forward in the media as “the face of retail”, which is stupid. He really is nothing but a publicity clown.
I would have to say that in my area, price trumps customer service every time. Most customers don’t care about the retail situation unless they are involved themselves, they will still drive 20km to Officeworks for the cheaper Reflex paper.
At no point am I bashing consumers, but to say things are fine in retail and it is only the bad operators doing it hard is wrong and is not telling consumers the full story.
To clarify where I stand we have been here a long time and have records to show this is as bad as it has been since we bought in 1989 and also in our previous business before that since 1974.
It is not wrong to say this is as bad as it has been for almost 50yrs and small retailer need help getting consumers to spend again.
I’m tired of people saying the economy is strong simply because we are selling our minerals to china.
We will outlast this because we have no other choice, we cannot just move into another channel, but if I’m the only one that thinks like this then bugger me.
Gerry Harvey is a hypocritic joke! Constantly whinging about declining sales because people are shopping online and overseas, then he himself goes and sets up in Ireland so that Aust customers can buy from him tax free!
The problem is not the that people are buying overseas, the problem is that Australian retails are not able to compete with overseas prices due to import taxes, high profit margin from wholesalers and manufactures, but more importantly big retailers blocking competition through trade agreements with some vendors..
Steven hit the nail on the head… it’s all about price first, customer service whilst important doesn’t drive people in the door price does…
Luke ” Consumers need to be told…” is, in my view, bashing.
We need to be told by consumers.
Every retail business need a point of difference which is compelling enough to get shoppers coming back. Price is no such point of difference.
Gerry Harvey does not represent small business.
Anyone have a rough guide as to what actually defines ‘small’ business?
Compared to ‘medium’ and ‘big’ business?
His holdings and outlets aren’t exactly what I’d describe as ‘small’ business.
saying retail is tough will not drive consumers thru the door either, people wont spend money just to make my numbers look good, i have to give them something they want, and that is a combination of product/service/price. crying poor wont achieve anything from either customers/suppliers or the govt, only we can make a difference thru the decisions we make every single day.
I think you are right Mark when you say that every retailer needs a point of difference. Gerry’s point of difference is his prominence created over years of advertising (which is now diminishing due to consumers waking up)
Gerry’s franchise model where his franchisees get in cheap but are made to advertise heavily is an asset to Gerry.
I cant do that but I can and do offer friendly service and convenience.We should know our POD and concentrate on it.
I am anyway. Pfff to Officeworks and their cheap paper.
i check prices online , then go to Harvey and tell them that what i got for and Harvey can match the online prices.
Y&G
You are right – HN is at the moment a Brand and is more of a corporate giant.
Harvey Normans model for customer service has nearly always been atrocious. He should start their, I wont go near one, in my case price or perceived price is irrelevant, the service is the worst i have seen.
He also has serious competion as well which he is not happy about.
I am not sure what defines a small business, some say turnover however in my case I am a micro small business.
The thing is that their brand USP is price and that is where they have a problem.
I agree with that, I should clarify up until now their prices are not necessarily cheap at all, its an illussion – the brilliant Marketing insinuates it.
Even if they were the cheapest, I wont go near one – one too many bad experiences in customer service.
Service is key, they used to be great. Last week I have a written quote for a video camera, I return to buy it and they refused to sell it to me saying “cant do it for that price”, while I had a written quote!! What a joke!!I will never buy anything from them.
I purchased goods through Harvey Norman On-Line in February, and 27th June, I am still waiting.
I have sent many emails, called the On Line Call Centre and asked them to advise when my goods will be provided. Yesterday, after many complaints I finally got HN to finally call me back. They say that the goods are finaly on their way.
Today I receive an email advising that my Case is Now Closed. They Close my Case before I receive my goods. This is simply the worse On-Line experience I have ever encountered. Pathetic!