Gerry Harvey

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THE NEWS WRAP: Gerry Harvey complains GST exemptions are not fair

11:19PM | Tuesday, 26 November

Furniture and electrical king Gerry Harvey has again called on the federal government to abolish the GST exemption on imported goods, telling shareholders the tax-free threshold is not fair.   “This is totally unfair. It won't make any difference to us, but it is totally unfair,” the Harvey Norman boss says.   “Business overall is not bad, but it's not easy. I don't see how it's going to improve suddenly.”   RBA warning on productivity   Reserve Bank deputy governor Philip Lowe has warned that future standard of living increases are at risk unless there is an increase in productivity, as the mining boom winds down.   “With rapid growth in Asia pushing up the prices of commodities, Australia's export prices increased substantially relative to our import prices.   “It is this increase in the average value of what we produce per hour of work – not so much an increase in the average amount that we produce per hour – that has been central to the increase in our living standards over the past decade.   “Over the next decade or so, if we are to achieve anything like the type of growth in real per-capita income that we have become used to, then a substantial increase in productivity growth will be required.   “If this lift in productivity growth does not take place, then we will need to adjust to some combination of slower growth in real wages, slower growth in profits, smaller gains in asset prices and slower growth in government revenues and services – in short, slower growth in our average living standard.”   Murray Goulburn will honour Warrnambool agreements with Lion   Murray Goulburn managing director Gary Helou says he will honour the Warrnambool Cheese and Butter’s cut-and-wrap agreement with Lion, should it be successful in its takeover bid.   Currently, WCB manufactures Lion’s entry level cheese brands, including Coon and Cracker Barrel.   "We will respect and fulfil and enhance every commercial deal that Warrnambool has today... including the Lion deal," Helou says.   "Lion is a big player in the Australian dairy industry. We have a good relationship with them and we are always talking about aspects of the industry and aspects of improving efficiencies for mutual benefits."   Overnight   The Dow Jones Industrial Average is up 0,09% to 16086.7. The Aussie dollar is down to US91.3 cents.

THE NEWS WRAP: Disappointing post-election results for Harvey Norman

11:35PM | Monday, 4 November

Harvey Norman has posted a 1.2% increase in sales at its Australian stores during the September quarter, with chairman Gerry Harvey saying an expected post-election boom in sales failed to materialise.   “I don't think the result is good. Sales are up… but they're marginally up," Harvey says.   "We haven't got the kick from the election that we expected. There's been a little bit of a pick-up, it's only small.”   Westpac profit up 14% to $6.8 billion   Westpac has announced a full-year profit of $6.8 billion for the year to September, up 14% year-on-year.   The strong result places it ahead of the $5.5 billion reported by the NAB and the $6.3 billion reported by ANZ, but behind the $7.7 billion reported by the Commonwealth Bank.   “We will continue to remain disciplined, due to global uncertainties and structural change in the Australian economy,” chief executive Gail Kelly says.   “However, I'm encouraged by signs of improving confidence, which we expect to lead to increased lending activity, in particular in New South Wales.”   Reserve Bank expected to hold rates on hold   The Reserve Bank is expected to keep rates on hold when it meets later today, with all 31 economists surveyed by Bloomberg expecting no change.   The cash rate is currently at a historic low of 2.5%.   Overnight   The Dow Jones Industrial Average is up 0.05% to 15623.39. The Aussie dollar is up to US95.17 cents.

Young, nimble and growing fast: Key lessons from the 2013 Smart50

9:14AM | Friday, 6 September

They’re nimble, young and brimming with innovation – they’re the innovators on the Crowe Horwath–SmartCompany Smart50 list of 2013.   The current breed of companies has been through a baptism of fire. Many lived through the global financial crisis, and can tell how it wreaked havoc on their businesses; but plenty saw the chaos as an opportunity – and it’s paid off big time.   To read the entire list, you can visit our page here. Some key statistics are available here, but needless to say – they’re extremely impressive.   In a year when businesses have struggled to stay afloat, the Smart50 have grown at an average rate of 92%. They are collectively turning over $595 million and have created 1750 jobs.   At the top of the list is technology company Plan B, which is built on the idea of making travel agents redundant. It’s working – the company has grown at a massive 210% over the past three years, and turned over $28 million in the last 12 months.   But the list is filled with plenty of stories like this. In fact, there are plenty of lessons entrepreneurs can take from the success stories on the 2013 Smart 50.   Here are just a few:   Keep your customers close   It’s been a few years now since retail king Gerry Harvey dared online retailers to sell bulky goods online. And now, companies like Winning Appliances have taken up that challenge with gusto.   But it isn’t a snappy website or a cool checkout system that has Appliances Online placed at 36th with $130 million in revenue – it’s good old-fashioned customer service.   Chief executive John Winning was brought into the business by his father, who taught him a crucial lesson – treat your customers right and they’ll stay with you forever. It’s an important maxim for a company that may only see its customers once every few years.   So how does it do it? One way is by handwriting thank-you letters to every customer.   “Our customers are king ,” Winning says.   “Exceptional customer service has been the driving force behind Appliances Online’s success and the company is the first Australian online retailer with an Australian-based customer support team that's available 24/7, every day of the year.”   Stay independent if you need to   Selling your start-up to a massive online retailer could be a winning scenario for many entrepreneurs. And for the founders of wine site Vinomofo, it was – for a time.   But a year after selling to wine site Catch of the Day, the founding trio decided it was better for the company to remain independent. So they bought their shares back, and sold to some private investors.   They’re happier as a result.   “We’re revelling in our independence,” says founder Andre Eikmeier.   The lesson is simple. Selling your company as an exit strategy can often bring lucrative rewards. But it’s not always the best move for your company’s future. Knowing when to sell and when to work on the company is a skill worth learning quickly.   Make others redundant   The top company on the list grew tired of dealing with travel agents. So it decided to make them completely redundant.   Plan B, a software company founded by Philip Weinman and Clive Sher, has grown a massive 210% in the past three yours and had revenue of over $28 million last year.   The business’s success is built on that fundamental ideal of solving a problem. The founders were sick of dealing with agents, so they created technology to do the job better. As they point out, “The need for traditional travel agents with high fees is now becoming less relevant.”   Recognising an opportunity is important, but seeing a business and being able to do it even better? That’s what great businesses are made of.   Research and development is key   The Australian market is filled with finance lenders, so it takes a giant leap to stand out. Nimble, which reached 42nd on the list with revenue of $19 million, took the slow and steady approach – and built its own technology over seven years.   The tech allows the company to more quickly determine which customers are ready to apply for financial products. But more than that, it more quickly detects fraud and has the ability to weed out riskier borrowers.   While the company has built a strong brand, it’s the technology that has played a big part in the company’s success. And founders Greg Ellis and Sean Teahan realise how important it is – so much so the R&D team has increased to nine staff.   They even have a mathematician.   “Thanks to that investment and the efforts of the world-class R&D team, the Nimble platform is now recognised as the most advanced credit-risk assessment and fulfilment technology in the country,” Ellis said.   The key lesson here? Investing in your company’s future is never a mistake.   Story continues on page 2. Please click below. Restructure when necessary   The supermarket price wars have taken down more than a supplier or two, and the surviving companies have to battle it out.   Baby products retailer GoToddler was threatened when Coles and Woolworths started reducing the price of nappies back in 2010 – by 20%. Given there was limited support from the supplier, founder Francesco Percopo said the environment soon became hostile.   Unfortunately, a restructure was necessary and the small team had to be downsized. But the company survived by doubling its focus on customer service – and creating loyalty. The strategy has proven successful.   "At GoToddler we have always believed that our business model has to be based on loyal customer support, and by offering better service and range. This has proved to be true."   Leverage social media for returns   So many companies fail to win a return on their social media, simply because they don't know how. But one savvy Smart50 finalist has taken the social media platform and turned it into a lucrative source for business.   Exactus Homes, founded by Ralph and Sandra Brewer, started building relationships on design blogs, providing advice and generally showing themselves as thought leaders in the industry.   The offers soon followed, and on Twitter as well.   "From our social media efforts we can identify $408,000 of confirmed work, and a further $480,000 currently in the planning phase," they say.   This is just one example of the Smart50 harnessing social media for growth – if you use it the way it was meant to be used, it can be a good source of growth.   Deal with problems head on   Finance companies are often put under intense regulatory scrutiny, and it's been no different for PAID International.   The company, which ranked 5th on this year's list with revenue of $8.3 million, ran into trouble earlier this year when Western Australian laws were changed. Overnight, it became a requirement for all short-term lenders to request 90 days worth of banking transactions from applications, in order to assess suitability.   While the process wasn't totally new to the company, there were processing issues which increased the company's workload.   It's easy to see how such a situation would turn customers away. But founder Tim Dean was simply upfront with his customers and told them what had happened.   "We also introduced new ways for the customer to provide the required information more simply and with fewer burdens for them," he says.   PAID International is a good example of how the Smart50 survive – by staying nimble and adapting.   Change your model when you have to   Changing your business model on the fly is never easy, but Plus Fitness didn’t really have a choice. When the company, which ranked 9th on this year’s list, was faced with customers that wanted 24-hour access, it had no choice but to comply.   “Originally we had a small number of traditional health clubs (big box clubs) in Sydney. Over time we recognised that our consumers’ demands were changing,” says founder John Fuller.   It was the right strategy – the company is turning over $13 million a year and growing at over 100%. Changing models isn’t easy, but sometimes, it’s the hard – and necessary – choice.   This story first appeared on SmartCompany.

Thinking of launching an online retailer? Meet Gerry Harvey

3:20AM | Thursday, 14 March

Last night, I was back at the Taskmaster Ranch, lounging back in a recliner after a long day at work, flicking through the channels, brandy old-fashioned in hand.

Gerry Harvey says he will dominate online retail: Five gems from his latest interview

3:58AM | Friday, 15 March

Gerry Harvey has been one of the most divisive figures in Australian online retail, and he’s not going away.

The law of the jungle: The dinosaurs of retail and media

3:37AM | Thursday, 14 March

Recently, Old Taskmaster went for a walk through the museum. All around stood dusty relics collected from days gone by.

Four business sectors cashing in during Australia's heat wave

3:12AM | Monday, 11 March

While the country may be sweltering through some of the hottest days ever recorded, some businesses are actually enjoying some success as the mercury rises.

In pictures: Australia’s five key online spending trends

11:40PM | Thursday, 29 November

If you’re selling your products online this Christmas, you should be gearing yourself up for boom time – research out this week shows that eCommerce sales will peak between December 7 and 10 this year.

Gerry Harvey says many retailers to collapse post-Christmas

3:31AM | Monday, 11 March

Gerry Harvey is at it again. The retail veteran has predicted gloomy times ahead for the retail industry, saying that while the upcoming Christmas will be a bright spot for many companies, the aftermath will be worse.

THE NEWS WRAP: Gerry Harvey forecasts new year retail doom but plans to be “the last man standing”

3:42AM | Monday, 11 March

More retailers will go bust next year after the Christmas sales are over due to dire conditions, Harvey Norman supremo Gerry Harvey has warned.

THE NEWS WRAP: Re-elected Obama promises “best is yet to come”

3:02AM | Monday, 11 March

US President Barack Obama has insisted the “best is yet to come” for America after winning a second four-year term yesterday, defeating Republican Mitt Romney.

Internet economy set to nearly double in G20 nations

3:22AM | Tuesday, 20 March

The internet economy will grow by more than 10% annually for the next four years in G20 nations, new research shows, with online retail, banking, advertising and IT services set to thrive.

Five good Gerry Harvey points on online retail

3:42AM | Tuesday, 13 March

Harvey Norman chief Gerry Harvey has come to his own defence, writing a short piece over at Business Spectator explaining why he actually understands online retail, in response to criticism following his move to downgrade online sales targets.

Five reasons to start-up in 2012 – and five reasons to think twice

3:51AM | Friday, 15 March

Figures released this week by the Australian Bureau of Statistics illustrate what many budding entrepreneurs have long suspected – conditions aren’t all rosy for new businesses.

Harvey Norman’s new website incorporates franchisees

11:37AM | Thursday, 24 November

Harvey Norman has finally launched an eCommerce site, despite the reservations of its chairman Gerry Harvey, but measures are in place to soften the blow for bricks-and-mortar franchisees.

Trio of Harvey Norman subsidiaries in administration

11:29AM | Monday, 7 November

Harvey Norman has appointed an administrator to three of its failing stores, amid complaints by landlords about unpaid rents on two abandoned Rick Hart stores in Western Australia.

Gerry Harvey to launch second online store, targets $100 million revenue in three years

4:07PM | Wednesday, 27 April

Retail giant Gerry Harvey has laid out some ambitious plans for his upcoming online store, saying that he intends to turnover $100 million from the site within the next two to three years and $1 billion within the next decade.   However, Harvey has also warned that he may have to cannibalise some sales from franchisees to continue operating the recently launched daily deals website Harvey Norman Big Buys. While the site has mostly been selling discounted goods imported from overseas, Harvey says he cannot continue selling cheap goods forever and will need to introduce premium brands.   "Hopefully I won't have to compete for five, 10, 20 years because I have got to be careful I don't upset my franchisees," he told the Australian Financial Review.   It is understood that franchisees do not receive revenue from the Big Buys site.   "I can say I won't [compete with franchisees] in the next year or two. But five years is too long a time to guarantee it."   Harvey was contacted for comment this morning by SmartCompany, but no reply was available before publication.   Despite the warning, Harvey is continuing with his online strategy. He says a full-service Harvey Norman online store is scheduled to launch by June or July, and franchisees will receive most of the revenue from those sales. Customers will have their goods delivered from the nearest franchisee.   "I've told my team I want them to turn over $100 million within two to three years and then take it to $1 billion within five to 10 years," he said, adding that he had relieved franchisee fears by saying that the online store would be the company's main online focus, rather than the Big Buys site.   "It's not a referral program because all the paperwork and business will be done through head office... the local store just gets told to deliver it and contact the customer when it's doing so."   Harvey has been resisting moving online for some time, arguing that digital sales won't provide much, if any, benefit for the company. But it is suspected that Harvey Norman's franchising structure has been a stumbling block to moving online as well.   However, Retail Doctor chief executive Brian Walker says he has access to various international examples of businesses showing that such a system can work.   "I'd be happy to share them with Gerry," he says.   Walker says that creating such a site will be good for the company, but warns that Harvey needs to keep focusing on a multi-channel approach that includes social media, etc, in order to increase sales overall.   "It's not just about visiting the online store, but about using social media and having an experience that makes me want to spend more. You need to use all your channels to market here."   "The strategy of the online store needs to integrate a good deployment model, social, media, and point towards the physical store as well that encourages me to visit that local store and spend more there. It's all about making the pie bigger."   The move online for Gerry Harvey comes as a number of department stores including Myer and David Jones have started focusing on their digital shopfronts.   Forrester research analyst Steven Noble says these bigger stores now have the perfect opportunity to increase their revenue as a result, even if digital stores are a small proportion of sales overall.   "We are seeing more people going online, and we are seeing more users buying online, and that's going to continue. The arrival of each new retailer provides a new reason for an online shopper to continue, but there are other factors as well."   "The fact internet access is becoming institutionalised, and so on, will help. I don't think the arrival of online retailers will increase sales overall, but with good luck and planning stores like Harvey Norman can take advantage of the growth of internet users overall."

10 lessons Aussie retailers can take from overseas sites

4:49AM | Friday, 27 April

He finally did it. After fulminating strongly against the relevancy, and then, conversely, the damaging impact, of online retailing, Gerry Harvey has decided to take the plunge with Harvey Norman Big Buys.

Harvey Norman enters daily deals domain

4:46AM | Friday, 8 April

Gerry Harvey has entered into the competitive world of group-buying, launching a daily deal shopping site just weeks after announcing plans to head online.

10 reasons why we need a Start-up Australia

4:08AM | Monday, 4 April

We looked on in a mixture of wonder and envy last week as the UK Government launched StartUp Britain, a scheme aimed at propelling wannabe Richard Bransons into business.

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