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Aussie Franchisor Who Would Be Economic Indicator

Over the last few years Australia's Gerry Harvey created a brand that doubles as the economic health meter for retail and small business. 

Chairman Gerry Harvey put the odds of Australia experiencing a return to boom-time conditions within the next two to three years at 90 per cent. 27 February 2010  Gerry Harvey predicts Boom times ahead The Australian

Most observers would not consider challenging Harvey Norman data as meaningful given that his franchise model operates like a well oiled machine across Australia with content operators leaving sales and profit fluctuations, excluding any obvious and abnormal other influences, as offering confidence in reliability, regularity and relevance that any government would have great difficulty in producinHarvey Normang.

Harvey Norman, with humble beginnings in 1961 and now the largest Australian electronics and furniture franchised retailer operating in 6 countries, has constantly been releasing sales and profit data to every major Australian media outlet with those figures said to represent the good and bad news for the economy.  And every media outlet picked up the idea and ran with it.

Last year especially, along with his ‘says it as it is’ persona we saw an entire nation confident that if Gerry said so it must be right.  Many have been watching this roll out in awe as Gerry Harvey’s entrepreneurial boldness, particularly around the GFC, catapulted an already house-hold franchise brand into constant free media.  To many this was an amazing orchestrated media coup in the face of the international proclamation of the end of the financial world as we knew it.  

Possibly a key to the Harvey franchise phenomenon is a large real estate portfolio that includes, amongst untold other investments, the Harvey Norman franchise network of dependable tenants. That and franchisee selection where you won’t find information online on how to become a franchisee. Gerry typically selects from performers within the ranks.  

Gerry Harvey was ridiculed in 2009 by internet marketing ‘experts’ in Australia because he refused to sell product online and take business from his franchisees. Accused of being a ‘dinosaur’, the self-made white goods billionaire offered nothing more in response than to suggest;

online retailing is still a waste of time. If you said to me in 50 years will people be successful, then yeah, but mostly not now.

From time to time the ACCC has taken an interest in Harvey Norman where seemingly the ending was an agreement to disagree.  Actually the ACCC agreed to disagree and from memory Gerry agreed to suggest the bureaucrats weren’t very bright.  But disagreements with the ACCC were related to retailing and not related to franchising.  By all reports his franchisees believe he walks on water and to my knowledge there has never been a whiff or a whisper of a problem.

Many may have wondered whether Gerry’s long standing mate, whiz-kid to advertising guru and regular larrikin, John Singleton, might have had a hand in the economic indicator campaign for free media. But no one would ever underestimate Gerry Harvey.

Most of the following offers only a snapshot of just how effective Gerry’s campaign has been but firstly for your absolute amusement; The Inimitable Gerry Harvey and John Singleton on Business and Passions [Gerry is on the right]:

Hilarious Singo and Gerry on national early morning television - Utube

20 March 2006  Gerry Harvey In For The Long Haul The Age:  It's hot, hot, hot — we're the biggest technology retailer in the country.  At the moment we've got $1.2 billion worth of property, we are heading to $2 billion,

April 11 2007  Harvey Norman eyes OfficeWorks - Reuters: ‘We'll have an extremely strong profit this year.’

30 July 2008 Harvey Norman feeling the pinch - SmartCompany: ‘”business is not good at the moment, but I’ve seen it much worse”. But Harvey has warned the retail sector may still sink lower in the coming month.’

2 February 2009 Loss Making Store Closures - Franchising.net.au: ‘However sales continue to struggle and Harvey predicts a continuing downturn in consumer sentiment.’ 

28 August 2009 Harvey Norman Profit Slump - ABC: ‘Harvey Norman releases regular sales updates throughout the year, and had repeatedly warned that margins were under strong downward pressure because of the economic downturn.’

24 November 2009 Harvey Norman Forecasts Record Sales - SmartCompany: ‘Our sales this year are going to be an absolute record, this is going to be the biggest Christmas we have ever had, we are going to break all records. I am absolutely flabbergasted sales are as good as they are.’

27 February 2010 Harvey Norman Expansion Plans - Sydney Morning Herald: ‘This looks like the beginnings of a really strong period. And once that trend starts, that upward movement starts, and you look back at what has happened for the last 150 years - I don't think it's unreasonable to assume within three years you might be in the middle of a boom.’

CEO Profile - Gerry Harvey

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