By James Wells
Narta executive chairman Kay Spencer has outlined the key challenges facing her members and the industry at the buying group’s 2013 seminar in Turkey this week.
In the opening address to the event, titled ‘People Make It’, Spencer claimed that despite the difficulties facing the industry, it was the important relationships between the retail members and its suppliers that would ensure the buying group would remain relevant and retain its important position in the market.
“Over the last two years, there has been a $1.8 billion decline in industry sales value and, as a result, we are a vastly different industry with 25 per cent of…shopfronts closing over this period,” Spencer said in her address to the 166 delegates.
“This has dramatically affected the distribution choices for suppliers and it has also tightened credit policies.”
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Since the 2010 Narta seminar, the group has witnessed significant change, including the demise of the substantial Clive Peeters business, and also growth from several new online businesses, which have developed organically from existing bricks and mortar stores. Examples of this include Appliances Online (Winning Group) and Savvy Appliances (2nds World).
New bricks and mortar retailers include the 200-store Betta Home Living franchise, the return of Rick Hart to the group with his Perth-based Kitchen HQ brand and the acquisition of the Retravision brand.
“From the outside, when you look at Narta it would appear as though we have added a diverse assortment of retailers, but we saw this as an opportunity,” Spencer said. “If we are going to be considered as a serious player we need to represent over 25 per cent of the market.
“Members that have been in the group for some time have a mutual respect for each other and we have new members, as well as management changes. Our role is to work with new members and integrate them into our way of doing business,” she said.
Spencer said she was proud of the group’s unique structure, which, while not always successful in every global market, has been recognised by numerous international retail experts as one of the more successful retail buying groups of its kind anywhere in the world.
This ‘unique structure’ is clearly working, with Spencer informing delegates that the group’s overall sales performance is exceeding the average growth, as reported by GfK. She was quick, however, to reassure her members that the group should not be complacent.
“We are an extension of the member businesses and we do not take this for granted; and we must also add value to suppliers — this is the religion of the Narta office.”
The next Narta seminar is expected to be held in conjunction with the group’s 50th anniversary in 2015. In the meantime, Spencer asked the delegates to try to make a simple prediction:
“In the past it has been easy to pick the winners and losers, but it is not so simple any more. Today the channels are set with the top five: Harvey Norman, The Good Guys, Dick Smith, Woolworths and…Narta. Is anyone ready to call which of the largest will be the mid-size of tomorrow and those that will not exist at all?”
The Narta members in attendance at the seminar include: 2nds World, Appliance Connexion (NZ), Betta Home Living, Bi-Rite Electrical, Bing Lee, Camberwell Electrics, Coogans Stores, David Jones, Diamonds, Dorsett Retail, E&S Trading, Electrical Discounters, JB Hi-Fi, Kambo’s Homemaker Superstore, Kitchen HQ, Kitchen Things (NZ), Mitchell and Brown, Myer, Radio Rentals, Spartan Electrical, Status Plus, Ted’s Cameras, The Nuance Group, Videopro, Whitfords of Five Dock and the Winning Group.