It’s always good to see an Aussie make it in the big bad world outside our shores. Even if, at times, New Zealand has a prior claim.
We are happy to describe Crowded House and Russell Crowe as being “ours” when it suits us. So it’s good to see the announcement that former Woolworths executive Greg Foran has been appointed to the role of CEO of Walmart USA. For those who don’t know, Walmart USA is the largest single retailer in the US, and part of the largest single retailer in the world. In Greg’s new gig, 1.4 million associates come to work each day and he is responsible for 4200 stores and annual sales of $US279 billion.
The interesting thing for me is that I have said for many years that Australia and New Zealand produce good, innovative retailers; they have to be as our economy has very few senior roles in manufacturing.
We are good at the “book ends” of the product cycle. We dig it out of the ground, which we do well with mining and farming. We then send it away to be processed in factories, because we don’t do that very well. And then sell it in retail, which we do well. We don’t do the middle bit, and as each year goes by, we are unable to compete with other countries’ manufacturers as we have a high and growing cost of labour. So if you are a bright young Australian or Kiwi with a desire to reach the top of your game, mining, farming and retail offer you the best opportunities.
So what? Well Alan Kohler on ABC this week had a great chart showing that the prices of all our discretionary things had continued to fall for the past four years. Cars, TVs, clothes all made overseas and imported, whilst the price of essentials, utilities, insurance, medical, education had all increased. All sourced and delivered from here in Australia. Our cost of doing business just continues to increase.
Australia is turning into a great big retail store. Our own retailers and new international retailers are opening stores or websites to sell to Australians. Some of the most successful Australian retailers manufacture very little or nothing in Australia. Kathmandu (which is, like Greg Foran and Russell Crowe, a Kiwi) has grown every year for the past six years and is now not just an Australia and New Zealand success but an internationally expanding success. Most of Kathmandu’s products are made outside Australia and New Zealand.
So a quick congratulations to Greg, and a message to any 20-something Australians, or Kiwis, who want to go far. Mining, farming or retail. Your choice.
Kevin Moore is a retail expert and the chairman of Crossmark Asia Pacific Holdings.