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Gerry Harvey explains “amazing” sales result

All categories across appliances, furniture and bedding are still experiencing record growth as people spend more time at home, according to Harvey Norman chairman Gerry Harvey.

“At the start of the pandemic, people were buying computers and freezers then washing machines and refrigerators, followed by big screen TVs and then furniture and bedding. Sales were strong from April to June then it continued into July, then August and now September – it is quite amazing,” he told Appliance Retailer.

“We are seeing growth in every category, including those that we only sell online like fitness equipment which has seen up to 300% growth.”

Earlier this week, Harvey Norman reported an 30.6% increase in aggregated sales revenue from 1 July to 17 September 2020 with comparable aggregate sales up 30.3%. Australian franchisees saw sales grow by 33.8% during the period.

When asked if these sales levels are likely to continue to Christmas, Harvey said “it’s not impossible” but was cautiously optimistic noting that there will be less money coming into the economy with JobKeeper set to be slashed by more than 50% on Friday.

“But if sales do continue, we might see our profit more than double.”

He said Western Australia is the best performing state in the country, albeit marginally, which he attributes to the strength of the mining and resources sector. Over in Victoria where stores have been forced to shut, Click & Collect has gone from “tiny to enormous” and Harvey believes there would be no argument to keep stores closed if case numbers fell to 10 to 15 a day.

“Our stores are nice and big, and we tend to only have a few people in our stores at one time unlike the major supermarkets.”

In early October, Harvey Norman will open a new store in Westfield Hornsby in Sydney’s north-west, which replaces the former Myer store. Measuring 6,000 square metres, Harvey said it will feature the latest fit out and there is nothing like it in the area.

Harvey Norman also hopes to complete the major renovation of its 10,000 square metre Cairns store in North Queensland by early 2021, which Harvey described as “the best store in town” with no competitors in the furniture and electrical space in the area.

“The bedding area has been open for around three months, but the remainder of the store won’t be ready until next year. In the end, it will be an 18-month project because we have continued to trade throughout. It is difficult to find suitable sites to open new standalone stores across the country, so we are focused on enhancing our existing stores.”

Harvey is also looking to grow the retailer’s overseas operations to account for half of the group’s total profit, up from around 22% currently, with new stores set to open in Ireland and Croatia. Harvey Norman will also enter a new overseas market with the exact location yet to be disclosed.

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