Hopes of a post-election economic boom have faded further, with business conditions and confidence now both falling, according to NAB’s latest monthly business survey. The survey shows business conditions fell from a score of five in January to zero last month, with a score of zero being neutral, while business confidence fell to seven, down from nine a month earlier. “As expected, the sharp turnaround in manufacturing recorded last month was largely unwound, and is now more consistent with the difficult environment that continues to face Australian manufacturers,” the report states. “Employment conditions are sobering – having reversed nearly all post-election gains and pointing to further labour market deterioration.” Zahra changes his mind over David Jones exit David Jones chief executive Paul Zahra has reversed a decision to stand down from his position, following the appointment of Gordon Cairns as chairman of the retailer on Monday. Cairns, who joins the board after the resignation of former chairman Peter Mason and two non-executive directors, says the company is yet to appoint external advisors to assess any takeover offer by rival Myer. “Anyone we appoint from the outside would evaluate the standalone value of David Jones and compare it to the alternatives, which will leave us in a better position to judge the Myer proposal,” Cairns says. ACMA investigation finds Telstra breached the privacy of 15,775 customers A joint investigation by the Office of the Australian Information Commissioner (OAIC) and the Australian Communications and Media Authority (ACMA) has fined Telstra after the personal details of 15,775 customers leaked on to the internet. The investigation found that between February 2012 and May 2013, the personal information from more than 15,775 Telstra customers, including 1257 active silent line customers, was accessible on the internet. The investigation was launched following a complaint that the names, phone numbers and addresses had been accidentally made available to be viewed on the internet. Overnight The Dow Jones Industrial Average is down to 16351.2. The Aussie dollar is down to US89.77 cents.
The G20 finance ministers meeting has wrapped up, with the forum agreeing on a global growth target 2% higher than current forecasts over the next five years. “In a major step forward, the G20 finance ministers and central bank governors have decided to put a number on our aspiration,” Federal Treasurer Joe Hockey says. “We are committed to implementing policies that aim to lift our collective GDP by more than 2% above the trajectory implied by current policies over the next five years. “Put differently, our policies could deliver over $2 trillion more in real economic activity and tens of millions of new jobs.” BHP Billiton boss still bullish about the Australian economy BHP Billiton chief executive Andrew Mackenzie says he remains confident about the state of the Australian economy, despite auto manufacturers ending Australian production and the closure of Alcoa’s Point Henry smelter. “To be pro-Australia for a moment, I wish [the closures] hadn't happened … but I have a global perspective, I see what happens elsewhere in the world and I still think Australia has an awful lot going for it,” Mackenzie told Channel Nine. “'I think examples like Alcoa and other industries around there just simply underscore the importance of the whole country to get behind an agenda of competitiveness and productivity. “I think we have got to all remember that the world economy is still growing quite well, Australia is still growing and growing a lot better than Europe, so please keep that up because that is one of the bets we are making, that you are going to continue to grow a bit better than Europe.” David Jones still open to a Myer takeover – at the right price David Jones is set to have discussion with Myer in a fortnight to further discuss the possibility of a merger between the two iconic retailers. Senior executives at David Jones are saying they are not opposed to a merger or takeover in principle, although are warning any deal with Myer will have to properly value their company. “It's not a merger of equals, it's a takeover, and in any takeover they have to pay a premium. What we can bring to the table is very valuable and that should be fully recognised in the value,” a David Jones source told Fairfax. Overnight The Dow Jones Industrial Average is down to 16103.3. The Aussie dollar is up to US89.85 cents.
The power of brave branding: Australian fashion start-up announced as a finalist for the World Retail Awards7:25PM | Sunday, 21 July
Australian online fashion start-up Shoes of Prey has been named as a finalist in the World Retail Awards. Founded by Mike Knapp and married couple Michael and Jodie Fox in 2010, the brand has boomed over the last few years. Shoes of Prey lets users create shoes using its online design tool. The brand has recently opened its first bricks-and-mortar retail store and is one of six finalists in the Store Design of the Year round. Jodie Fox told StartupSmart the nomination was recognition of the power of brave brands, and that start-ups shouldn’t shy away from developing a strong and unique brand. “So long as you are true to expressing who your brand is and providing a valuable experience to your audience, don't be afraid to be bold and make a statement,” she says. “Start-ups are designed to disturb the space they compete in. It's been a really successful venture for us and we are thrilled to be listed as a finalist.” Fox says the store was designed to showcase the creative possibilities of the Shoes of Prey brand. “The store was meticulously designed, from the scent to the soundtrack to the sculptures, to engender an atmosphere of unbridled imagination that invites women to reconsider the way they shop for shoes,” she says. Managing the rapid growth of Shoes of Prey across multiple areas of the business has been a challenge. Fox says the focus has been on ensuring the customer experience remains strong. “This involves everything from improving the product, enhancing the website, to messaging our brand and then scaling production to keep up with demand. “This process now involves the boutique, and while it's a challenge, it's also exciting to be able to bring a product that I love and believe in to more and more women,” Fox says. Finalists for the World Retail Awards are assessed by a panel of 16 judges, including Myer chief executive Bernie Brookes. The winners will be announced on August 2.
New reports from the Parliamentary Budget Office and the Treasury have called into question key figures in the federal budget, with the reports raising the prospect of a blowout in the 2016/17 budget. According to the reports, the federal budget assumes a short term increase in commodity prices followed by a steady decline, leading to a budget surplus of $5 billion for fiscal year 2017. Weaker commodity prices, however, would lead to deficit of between $5 billion to $22 billion, with significant tax increases or budget cuts needed to make up the shortfall. This shows there is a coal and iron ore bubble that has made the Australian budget numbers look much better than they really are. As the miners keep digging, and more hot air comes out of commodity prices, that drives most of that massive gap,” says Deloitte Access Economics director Chris Richardson. Telstra prepares staff for job losses as part of restructure Telstra has warned of potential job losses as part of a restructure, according to an internal memo to staff from chief operation officer Brendon Riley. Under the proposed changes, which will be rolled out between now and July 1st, the telecommunications giant is set to redirect resources to high-growth businesses such as wireless and network services and away from loss making divisions such as its Sensis directories business. “Our traditional businesses are coming under increasing margin pressure and the largest portion of our budget is spent supporting them. This is not a sustainable business model and we have an obligation to redefine our contributions to Telstra,” Riley says. Myer to chase discretionary sales after releasing strong quarterly results Myer chief executive Bernie Brookes has announced the retail giant is set to launch an aggressive stocktake sale in attempt to lure customers from competitors such as Target, in a bid to grow its share of consumer discretionary spending. “The pleasing part for us is that it will coincide with our very aggressive stocktake sale, which will make sure we're still in play in an active way over the course of the next couple of months,” Brooks said. The news came as Myer reported sales were up 0.5% to $652.5 million for the quarter ending April, up 0.4% on a same store basis. Overnight The Dow Jones Industrial Average is down 0.53% to 15,306.40. The Aussie dollar is down to US97 cents.
Businesses must honour a takeover target’s heritage, have a clearly defined strategy and address conflict when the acquisition is taking place, the head of a successful branding and clothing company has warned after buying a 69-year-old business. Dorry Kordahi, the co-founder of promotional branding and clothing business DKM Blue, says businesses must always consider keeping staff on board during acquisitions. DKM Blue has just completed the acquisition of 69-year-old clothing group Ambassador Clothing, which operates several brands including Zambelli, Nic Green and Ambassador Corporate, which counts the New South Wales Police as a customer. The family business entered administration late last year, with a debt in excess of $4 million owing to NAB. DKM Blue, meanwhile, has established a strong foothold in the market, most notably in the areas of promotional product, corporate and safety clothing, and luxury goods. There are now more than 30 leading brands in DKM Blue’s portfolio. Dorry Kordahi revealed to StartupSmart how DKM Blue intends to integrate Ambassador into its operations, highlighting some key tips for start-ups. Ditch what doesn’t work DKM Blue has made no secret of the fact it will move away from Ambassador’s retail outlets and contract with Myer in favour of expanding the company’s key brands online. “Myer was distributing the Zambelli and Nic Green labels, and they had 12 retail outlets as well,” Kordahi says. “Ambassador will still be running as a separate entity but definitely leveraging off DKM Blue’s operations and background to have a streamlined operation.” Keep key staff on board “We’re going to be bringing across four key personnel including their pattern-maker,” Kordahi says. “He’s the second pattern-maker the company has ever had and he was taught by the first pattern-maker. It’s important to bring him across. “We’ve got the two sons of the founding owner coming across as well and a customer service coordinator.” Honour the company’s heritage “They’re a 69-year-old business, primarily an Australian-made manufacturing business,” Kordahi says. “The sad fact is Australian manufacturing is a dying breed. It is a very challenging industry to be in. Hence a lot of Australian manufacturers are closing down and going overseas. “Our aim is to maintain a proportion of Australian-made products.” Have clearly-defined roles “From an operational point of view, you’re always going to have clashes with old and new. What’s worked well for us is defining roles within the business,” Kordahi says. “Everyone has roles and responsibilities, and we’re all accountable for those roles and responsibilities. We’re not doubling up on the work but actually leveraging off both companies. “It’s a matter of accepting, adapting and committing [to the new structure].” Address conflict head-on “For me, it’s all about speaking straight and… hitting situations head on. If people can’t accept and move on, you can’t move forward,” Kordahi says. “I’ve always been a firm believer that if you don’t hit it head on, you’re going to have issues. You can’t let things fester. “A lot of the time not everyone will be in the position they want to be in. You need to look at the company as a shareholder and treat the business as a business.”
Almost 80% of Australian consumers oppose reductions to the GST-free threshold on overseas online purchases, but any change will do little to quell their appetite to spend, new research reveals.
Finn Haensel, co-founder of The Iconic, had reason to sound chirpy on the telephone this morning after just announcing a $25.2 million investment in the online fashion retailer from US-based venture capital firm Summit Partners.
Business leaders have welcomed the Reserve Bank of Australia’s decision to cut interest rates by 25 basis points, with the commercial banks are now under pressure to pass on the reduction.
A host of retailers have claimed titles at the 2012 Australian Retail Awards including Oroton, Pandora, Lenard’s Chicken and eyeclarity, which was named Independent Retailer of the Year.
Click Frenzy, Australia’s first online mass discounting event, has seen a surge in early consumer interest, with the site crashing shortly after its launch last night.
The retail campaign to make online purchases subject to GST has been dealt a heavy blow, with prominent executives saying companies should give up the fight and accept it'll never happen.
How long do the niche online players in Australia have before the big boys wake up and crush them?
The Australian sharemarket had its worst day in two months yesterday amid renewed concerns over the eurozone debt crisis.
The head of fashion retail chain Glue has warned brands engaging in constant discounting they may be barred from appearing in any of the company’s stores, in a twist on the usual retail price maintenance debate.
Labor’s leadership battle could cripple the already-fragile state of business confidence, business groups warn, with concerns raised over how Kevin Rudd’s potential return would affect conditions.
Retail rents are expected to remain stable in 2012, according to Colliers International, despite store closures by major retailers including Dick Smith, Billabong and Specialty Fashion.
Industry groups have thrown their support behind the Federal Government’s renewed promise to return the budget to surplus, but have raised doubts over the measures it will use to achieve this.
Five days after seeing Myer CEO Bernie Brookes speak I am still thinking about what he had to say.
This article first appeared on January 10th, 2011. The other day I met Bernie Brookes, the chief executive of Myer.
British online fashion retailer Asos.com will launch a dedicated Australian website at the end of September, suggesting local fashion start-ups could be up against some stiff competition.