Harvey Norman executive chairman Gerry Harvey has issued a dire warning to retailers, saying that conditions in the industry are dire and that many more stores will go under in 2013 after the Christmas rush is over. He told reporters recently that more retailers are currently under pressure than he has ever seen in the half century he has been in the trade.
Harvey’s dire prediction for the retail industry comes closely after the collapse of Retail Adventures, a discount chain operator. The company announced that 32 stores would close permanently at the end of November and that 650 employees would be out of work.
He went on to say this is only the beginning of a trend and that several other businesses which are teetering on the brink of going under will hang on for Christmas sales, but will find the first part of next year very difficult. Many of the companies at risk will need only a slight push to go over the edge into financial failure. Harvey predicted his company would outlast the competition and be the “last man standing.”
Harvey also predicted Christmas sales in Australia would outperform 2011 levels if the weather remains warm. He is hoping to sell a lot of air conditioners during the Holiday Season.
The retailer is giving its franchisees a lot of financial support to maintain service levels in the weeks leading up to Christmas. Harvey responded to critics of this policy by stating that losing staff during such a crucial time in the retail calendar was simply unacceptable. The company’s focus is on giving the customer the best possible experience when visiting the stores at Christmas and going in the New Year. This, Harvey feels, will be the key to success in 2012 and beyond.
