Sarah Falson

Retail giant Harvey Norman Holdings Limited has announced its sales from the franchised ‘Harvey Norman’ stores, commercial divisions and other sales outlets in Australia, New Zealand, Slovenia, and Ireland increased by 11.6 per cent for the three months ended 30 September 2007, compared with the same period last year.

Sales totalled $1.39 billion for the period, while like for like sales for the three months increased by 5.7 per cent.

The company’s annual general meeting has been scheduled for 20 November 2007, shortly before the federal election.

“The directors of the company are aware of some commentary by analysts in relation to market expectations about the projected profit of the company for the year ending 30 June 2008,” the company’s CFO, Chris Mentis, said.

“The company understands that the published commentary by analysts who regularly publish commentary about the prospects of the company is that, in the respective opinions of those analysts, the net profit after tax (“NPAT”) of the company, excluding net property revaluation increment, for the twelve months ending 30 June 2008 will increase within a range of 12% to 28% over the NPAT, for the twelve months ended 30 June 2007. Directors of the company are not prepared to speculate on NPAT for the year ending 30 June 2008.”

The net profit from continuing operations attributable to members, after tax and minority interests, but excluding significant one off items and net property revaluation increment (“Net Profit from Continuing Operations”) for the six months ended 31 December 2006 was $132.87 million, said the financial report.

“The directors of the company expect the Net Profit from Continuing Operations for the six months ending 31 December 2007 will increase within a range of 25% to 35% over the Net Profit from Continuing Operations for the six months ended 31 December 2006,” said Mentis.

Fujitsu Australia & New Zealand has just completed the installation of an integrated enterprise resource planning (ERP) system in 20 new GSM Retail stores in a record nine weeks, just in time for the Christmas rush.

GSM Retail is a new national reseller of Vodafone mobile phones and plans and went to market in July with the urgent requirement to organise modules for operations, sales, inventory and procurement in a unified system across all stores.

According to Fujitsu, the installation was performed in a record timeframe for a SAP (systems, applications and products) project in Australia and New Zealand.

The final integrated solution encompasses all the core business functionality for the entire organisation, and provides a complete, unified view of all business transactions and relationships to support GSM Retail in growing the enterprise.

GSM Retail reportedly chose Fujitsu and its SAP proposal in a competitive tender against Oracle, Microsoft and Netsuite, to deck-out its new concept stores.

The new stores are all Vodafone-branded retail outlets located nationally within Myer department stores. In addition to the first 20 concept stores opened this year, GSM will continue its roll-out with 30 more stores early next year and thereafter keep pace with Myer’s expansion to 75 stores, says the company.

“We have plans for rapid growth and needed an ERP system that was not only capable of supporting our expansion in the lead-up to Christmas, but also of providing the functionality, flexibility and scalability to handle increasingly diverse business and product streams over time,” said GSM Retail’s group financial controller, Alexis Phitidis.

“We were impressed by Fujitsu’s professionalism, their demonstrable expertise and skills with SAP, and their ability to work with us in meeting our aggressive timeframes with a best practice solution. The team readily adapted to our business requirements to ensure the project was delivered on time, within budget and to the agreed scope. Working with Fujitsu gives us a single point of accountability for the software, hardware and services relating to our ERP system.”

Phitidis says despite the short time frame, Fujitsu did not compromise on the quality of the installation.

Fujitsu used a SAP baseline solution using SAP Best Practice building blocks with pre-configured processes installed. This allowed the Fujitsu consultants to leverage existing best-in-class processes and templates to expedite the implementation rather than starting from scratch.

As a result of its successful delivery of the initial implementation, Joe Landsman, CEO of the GSM Retail Group, has commissioned Fujitsu to further expand its solution footprint in New Zealand, Fiji and Japan.

Web-based retailers should have already begun to experience a boom in business with consumers choosing to avoid crowded shopping centres, instead comparing products and prices online at sites including Amazon, eBay and Trading Post.

Shopping websites accounted for 6.34 per cent of web traffic in the second last week of November, with Emailcash Australia, Trading Post, eBay and Amazon leading the pack followed closely by dealsdirect.com.au and oo.com.au, according to research from Hitwise.

The figures indicate an increase in web-based shopping, suggesting consumers now expect to be able to search, compare and buy from the convenience of their home. Ecommerce provider, eCorner, says the traditional model of retail sales has changed.

“We are seeing quarterly growth of nearly 50 per cent in the number of online stores being established, with most large corporations planning their internet strategies at senior executive levels,” said eCorner’s John Debrincat.

“With companies like News Corporation reporting online revenues of more than $1.2 billion, it’s clear that organisations without skin in the game will be left behind by their competitors.”

Key To Success

But it’s not only large retailers with the excess stock that can play online, with small businesses also capitalising on the trend either by establishing their own online stores or partnering with online shopping malls and comparison sites.

“The push to online sales in Australia and New Zealand has seen the arrival of new businesses like Getprice and Shopping.com in the comparison shopping area,” said Debrincat.

“Online marketplaces like Ferrit.co.nz are also providing a new shopping experience in the retail market.”

It’s not only price that drives consumers however, with shoppers opting for trusted websites over unknown destinations. Getprice CEO Chris Hitchen says the most successful online malls will be those that provide the most added value.

“Getprice’s focus on comparison shopping rather than price comparison reflects the fact that it’s not always the cheapest price that sells a product,” he said.

“While we recognise that price is a leading criterion for many consumers, other factors such as trust, reputation, a local manufacturer’s warranty and add-on services are also important in winning custom from savvy consumers.” 

Global Market

European ecommerce sales are expected to grow by 25 per cent per annum over the next five years after 2006 revenues reached US$133 billion. In the US, spending is tipped to exceed US$200 billion this year with quarterly growth of almost 25 per cent.

The trend in Australia and New Zealand has been similar, but off a smaller revenue base with ecommerce sales exceeding A$45 billion in 2006. Of this, only about NZ$1.5 billion was transacted online in New Zealand, which has tended to lag the larger markets when it comes to ecommerce sales, says Hitwise.

OZtion, which claims to be the country’s second-largest online auction site (www.oztion.com.au) has developed a second version of its Express Lister software program designed to help small Australian businesses expand their online stores and accelerate online sales.

Running on either Windows Vista or Windows XP, Express Lister 2.0 allows businesses to easily edit and maintain large amounts of product information, and automatically control how products are presented and sold online, according to the company.

Essentially, Express Lister is software tool that works in conjunction with the online ecommerce and auction services provided at www.oztion.com.au

The program “automates” the process of populating an online shopfront with product information, including managing product photography, item descriptions, and formatting the presentation of information, says Oztion.

According to the company, this reduces the amount of effort needed to sell similar items, or list many items at once.

“When you are selling products online, keeping all of your product information up to date can be a major task. Many small businesses are forced to restrict the product range they offer in their online stores because they simply don’t have the time or manpower to enter all of the information. Express Lister is designed to automatically manage the process, making it easy for small businesses to expand their online stores, and ramp up their online sales,” said Oztion managing director, Philip Druce.

Users can easily import product information from eBay’s Turbo Lister software tool. Express Lister provides sophisticated template features for formatting product information, as well as automatic photograph resizing features.

When product information is imported from eBay’s Turbo Lister, product category matching is carried out automatically.

The software will be available for purchase in December, and is free for any OZtion member.