By Chris Nicholls
SOUTH AUSTRALIA: A South Australian electrical retailer has claimed Harvey Norman in Mildura, Victoria, has tried to steal sales across the border by setting up temporary ‘expos’ in South Australia and selling goods at “ridiculous” prices.
The store manager, who requested not to be named, said the tactic was damaging business in the local area.
“What they do is they hire out a big hall or a pub, and they bring all their TV’s … and do ridiculous prices and try killing our local market.”
He said the “expos” lasted for four to five days.
Harvey Norman Mildura’s electrical manager, who only referred to himself as “Fred”, confirmed the store had used the tactic in the past, but would not elaborate on how many times it had used the ‘expos’ or whether it would continue to do so in the future. Harvey Norman head office’s account manager Samantha Waters said she was unaware of the tactic.
However, Harvey Norman executive director David Ackery said the practise had been in use for a long time.
“Occasionally, franchisees will take a Harvey Norman offering to a market where we’re not represented and this has been going on for years; 10 years, maybe 15 years,” he said.
However, he said the prices set were up to franchisees.
BSR Group general manager Ian Brown said they did not engage in such practices and cited the Commonwealth Government Franchise Code of Conduct as the reason.
“BSR as a group are franchisers, and all our stores are licensed under the Franchise Code of Conduct, which is a Commonwealth Government act. Therefore, every one of our retailers has a designated marketing territory. Each of our retailers must not market outside of that area without prior approval from BSR as a group,” he said.
“Yes, it [Harvey Norman’s marketing technique] does affect our retailer in that particular territory, and as far as the law’s concerned, no there’s nothing we can do about it.
Other retailers were contacted for the story, but had not responded before publication.