Opinion by Patrick Avenell

One of the reasons so many classic music stars have been touring Australia this year — Paul Simon, Bruce Spingsteen, Guns ‘n Roses — is because our dollar has been so consistently high. An aging rocker can make a lot more money touring Australia than any cities closer to home.

The phenomenal consistency of the dollar — at or around price parity with the US Dollar for more than two years — has been an incredible boon for some.

Apple, for example, is making a motza selling iGadgets down under, reaping in billions of Australian dollars. The PC manufacturers love Australia for our high prices and high standard of living and we’ve quickly become the second most important region for nearly all European appliance suppliers.

One company not doing so well out of the high Australian dollar is Harvey Norman. In its quarterly sales result, a company spokesperson said “the market appears to be stabilising despite the stubbornly high Australian dollar”.

The high value of the Australian dollar is especially bad for Harvey Norman. The company owns subsidiaries in Croatia, Slovenia, the Republic of Ireland and Northern Ireland (UK), meaning profits generated in those regions must be converted to Australian dollars when they are repatriated.

Back on the first day of 2008, one Pound Sterling bought you AUD $2.27. You now only get $1.48. The Euro is a similar story: down from $1.66 to $1.27 over the same dates.

At the same time Harvey Norman is losing money in foreign exchange, it is also losing money to foreign traders. The very high Australian dollar is making overseas-based online retailers incredibly attractive to savvy, price conscious consumers.

Harvey Norman has the Canon EOS 7D for $1,398 on its website. That same model is $1,097 on CamerasDirect. Eastern European based online appliance stores are offering Miele appliances for half the Chartered Agency price, which Harvey Norman franchisees are unable to negotiate.

Harvey Norman is wedged by this stubbornly high dollar, losing money both ways. If the dollar were to drop in value, its revenues could increase quickly and sharply. Perhaps instead of writing the company off as a has-been, the critics could offer a touch of sympathy, lest the company isn’t completely finished just yet.