BANK - BIG 4

This is a story about the culture within a big 4 bank having an all pervasive internal ethos of – ‘right’. 

Thousands of employees believed they were right in everything they did because their chief executive told them so and defended their actions even though they often bent the law.  Indeed, this bank believed it was above the law because it was big and controlled money and they knew that money was everyone’s lifeblood.  It was superior and knew it was superior because everyone was always nice to them.

'You need our money' preached the bank and people queued up to borrow their dream.  After all, this was its job, to enable dreams.  Or so it said.

Their real job was to buy and sell money at a profit - perfectly commendable and natural for any big public company.  Indeed, most of us sell our time for a profit as do all the employees of the big public company / bank.

Unfortunately, some of the employees of the bank were sick the day ethics were handed out and they did things to advance their own career at the expense of reason and often ignored lawful requirements.  After all, it wasn’t their money or dreams and they knew they were right because their senior managers supported them and even encouraged them to act in bad faith.  Why be a nice guy when you can make lots of money by selling the dream then ripping the dream away – for a profit?

One day, one of the more ethically challenged employees decided, without cross checking, that a client had failed to pay a mortgage payment of circa $2,400 on his home months before.  If the employee had checked he would have realised that it was the bank that had made the blunder but fact checking was not in his mindset so he knee jerked into pious action in the absolute knowledge he could do nothing wrong - because he was a part of the bank and was always – right.

He rang the client with the opening statement, ‘We are going to sell your home in 30 days’.  Needless to say the client was somewhat taken aback, confused and indeed scared because the bank had aggressively threatened his dream without cause or reason or even humanity.

Still, this client had a life’s ethos in that it wasn’t the problem that was important it was how you dealt with it.  He knew he was outgunned by the bank that was constantly increasing its feverous attack and sought support from the Ombudsman.  This stopped the drivel and the insane fervour by the bank because the Ombudsman sported a protective umbrella shielding the client whilst they investigated as an independent authority.

That independent authority found the bank was wrong on all counts and awarded damages, compensation et alia to the much relieved client.  However, the issue now was that the client had lost a lot of money, time and opportunities as a direct result of actions by the bank but the Ombudsman was powerless to award anywhere near the quantum of loss.

The client was confused.  Would he accept the determination and accept losses whilst the bank rolled onto their next victim or would or even could he take it further.

At this point he discovered that the employee who had acted illegally threatening to sell his home had been promoted within the bank.   They were content within themselves that they were right and above the law as they had just promoted the dissident with not one syllable of apology to the client for their unlawful acts causing a great deal of stress and loss.

The client was determined to address the issue and pointed out to the bank they were found to have acted unlawfully by the Ombudsman and should compensate him for sustained losses.

The bank always seeing themselves as – right – refused.

So the client took them to VCAT where a higher level of jurisdiction could right some of the wrongs.

Now, the bank was incensed that a lowly client had the temerity to take them on even though they knew the client was the innocent and the somewhat aggrieved party.  After all, they were always right and strutted and pontificated that fact at every chance.  'How dare he!'

As a power play and not so subtle threat to the lone unrepresented client they engaged multiple lawyers, barristers and employees to defend their position in court.  Cost was irrelevant because it was shareholders money and they knew they were always right.

However, this client had done some homework and blocked every legal ‘trick’ the bank threw at him.  The client was not driven by career or personal gain but by mitigating personal loss.  Big difference and somewhat focus inducing.  At that time the bank was respected as a leader with enormous market power which did intimidate the client somewhat and that reality eventually forced a compromise.  How long could he hold out against dozens of lawyers and million dollar bank employees who were always right?   

After 5 years he settled because of a huge power imbalance and the self promoted invulnerability of the bank

That settlement saw the bank lose quite a few thousand dollars to the client but with a full cost to the bank of over a million dollars.  All for a alleged debt of $2,400.  But that’s alright because it’s only shareholders money. 

The client had mitigated some small part of his losses and the bank pontificated on as the all powerful trying to gag any public response by the client.  But now, enter the Royal Commission where Christian Porter – Attorney General said, “The royal commission has noted is that its standing powers enable it, in effect, to override the existence of any non-disclosure agreements.“  The same logically applies to settlements especially where and when there is a huge imbalance of market power forcing outcomes.

The big public company / bank now had nowhere to hide and its culture was for the first time on show for all to see, and it was found wanting.  It turned out that the bank was not superior, not right and that the chief executive had failed to act in good faith by presiding over a ‘toxic’ culture enabling many and various unlawful acts by various ethically challenged employees.  Indeed, in our client’s case the chief executive knew and sanctioned the events leading to a million dollar plus loss of shareholders money.

That revelation cost the jobs of the Chair and chief executive but still left our client in a loss situation.  A loss situation caused by and through a toxic culture supporting unlawful dysfunction.  Note that fault lies with the office as well as the incumbent executive. You can’t just change the executive and expect that all is now well.  The bank must take responsibility as an entity.

So, now our client has a determination by the Royal Commission which says the bank is indeed responsible for their ‘toxic culture’ causing dysfunction and client losses.  The bank is no longer invulnerable with pontificating executives self elevated above the law and past settlements can be revisited especially where bullying or coercion through size dominance was a factor in the signing.

Our client is now able to pursue losses caused by the bank and will.

The bank must decide if it will do the right thing and take responsibility for its actions or just continue on with an air of invincibility throwing and wasting even more shareholders funds at can’t win legal bills.

The story continues.

QANTAS - They offer platitudes without substance

Firstly ...

Prior to our flight with Qantas this time we were given two passes to the Qantas club as compensation for another Qantas flight which they screwed up.  That ‘honeymoon’ flight was somewhat ruined when our allocated seats were ignored and Qantas reallocated us rows apart.  After I complained to the desk crew they once again reallocated us but to the last row and by the time catering got to us they ran out of food.  Two passes was totally inadequate.  Qantas even said that even though one can book specific seats there is no guarantee that you will ever get them.  Misrepresentation and unfair terms all spring to mind when the ‘fine print’ denied responsibility for advertised benefits such as seat allocation.

Then ...

This time we had time to spare so we used our two passes and entered the Qantas club in Melbourne.

The only acceptable thing about the experience were the women on the front desk who were polite, respectful and helpful.

Picture a Coles cafeteria of the 1960’s awash with people and mess.  This is the sight which greeted us.  Down market is an understatement.  No available seats, piles of used plates and mess everywhere.  Still, our passes were now taken away and we persevered until someone left and we grabbed their table.

We thought that perhaps a glass of bubbly would be nice only to find just over a glass left in the self serve which was not replaced for the 45 mins we were there.  No staff!

Try breakfast.  There must have been over 100 people in the largish facility yet the hot breakfast options consisted of 6 getting cold tiny sausages, a small bowl of scrambled eggs which should have been replaced hours before and slices of warm tomato.  That’s it!

We then sought coffee but found a problem as there were no cups.  We scavenged the entire lounge for cups to find two and tried the machine coffee.  It was undrinkable and we left same.

An original Qantas screw up leading to this ‘compensation’ which proved well below any standard.  No bubbly, food we couldn’t eat, coffee we couldn’t drink and all in a dirty space. 

One has to ask just what Qantas are doing.  What sort of management lets this happen?  Obviously management were incompetent and needed help if not look for another job.

Move on a few weeks to Qantas club in Heathrow and the whole experience was vastly different.  Good front desk, good staff, a clean lounge, a snack buffet of fresh food and nice wines served by great staff.  Toilets immaculate as were the showers.  A good relaxing place my wife and I enjoyed during our forced 10 hour break between flights.

Pity Melbourne is managed so badly.

Then ...

Our actual flight from Melbourne to Singapore was barely above Neanderthal with extremely tight seats further disadvantaged by almost non-existent service.  Cabin crew are wait staff and as such bear a huge responsibility to make customers feel special and to cater for their every need.  Staff chatting in the back of the plane instead of looking after customers is offensive to paying guests. 

The catering offerings were as down market as the Qantas club.  The bread roll was inedible being nuked too long as was the so called pizza.  The blade ‘stew’ was below first year apprentice standard and the mash had the consistency of yogurt.  Absolutely awful.

Then ..

We were told our next flight from Singapore to London [QF1 on the 20th of December 2018] was running 3 hours late with no explanation.  This meant we would have missed all connecting flights to Helsinki et alia despite allowing a 2 hour window.  No reason or alternatives were given despite asking for same.  We found a Singapore flight which would have lobbed us into London with time to spare for the connection.  We asked Qantas to re-book us on that flight and they did but somewhat grudgingly.  We were glad to get rid of Qantas.

Qantas, just what are you doing?

Qantas, like some others, have developed a ‘commuter bus’ mentality rather than a ‘tourist coach’ mentality.  This also applies to the so called club at Melbourne.

Do Qantas care?  Definitely NO!  They offer platitudes without substance.

RESTAURANTS AS PUBLIC TOILETS

Restaurants are NOT public toilets and it amazes me that the downward challenged think they have a right to use what is in effect a private toilet when they feel the need. These people should put their names on a public database so that any and all can come knocking on THEIR door. We have travelled extensively and like everyone else needed to use a toilet at times but, out of respect for the restaurateur, we became a customer and at least bought a beer so we could use the facility [unfortunately a self defeating cycle - wahoo!] .
Good word, respect.

WHERE ARE YOU FROM?

It is the Australian way and is indeed behoven on everyone to embrace all as ‘mate’ but with respect  and generosity .   Make people feel special by welcoming them into your greater circle through recognition of their heritage - because that is their history and that is ‘who they are’.  We are not all the same and it’s the differences that make for interesting ‘everything’ and a successful multi-cultural society.

Embrace the differences!!

Humans attempt to ferret out similarities so that we perceive common ground from which to, make friends.  This is neither nefarious nor does it sport hidden agendas.  It is a simple and genuine desire to interact. 

In Europe where there are many many nationalities the question ‘where are you from’ is an ice breaker question designed to proffer conversation [not discussion].  It is not aggressive or demeaning or threatening or building to a racial ‘discussion’ rather it is an act of friendship to be able to just talk.  Talking is good.

So, for all who see a threat by asking the question, ‘where are you from’, get a life.

Interest only loans

I am having trouble understanding the hoo-hah and drivel surrounding interest only loans.

There are continual reports and articles by so called expert journalists expounding doom and gloom warning that millions are about to lose their homes all due to the borrowers stupidity and having the temerity to acquire interest only mortgages.

Human nature is such that we will believe anything which falls in line with our hopes and desires because we want it to be true.  Financial Services Providers [FSP] know this and advertise their products to appeal to satisfying those hopes and desires.  Nothing knew and something of which we are all well aware.

The FSP throws out a carrot to vulnerable people [all of us] by offering the dream couched in glowing rhetoric.  People look past the 95%+ leverage and the interest only nature of the loan because they can now afford to get into their own home and stop paying rent and the world will now be a place of joy and abundance.

Providing the numbers are correct in terms of affordability and our countries’ economy is solid, this cannot be a bad thing on several levels including growth in the building industry and giving people a smile.

However, FSP’s are treading a fine line to profit because they know an economic hiccup may cause issues.  Even if employment is strong any downturn in prices will see the people who were sold the dream drop into ‘temporary’ negative equity.  This is not an issue for the borrower as property prices will increase eventually but it is an issue for the lender or those people who sold the dream.  Why?  Because their loan books have also hit negative equity and they may even be trading insolvent because they have lent more than their assets cover.

So, it’s not the borrower who has the immediate issue, it’s the lender having overstepped their own risk parameters and panicking.

Everyone then panics driven by stupid sensationalist reporting and spending stops and the country slows causing even more panic and we all, lose the smile.

The issue is NOT interest only loans as this is merely a vehicle to pay and it’s the borrower who must face the consequences and pay the piper if the world’s economy implodes, terrorists blow up Christmas, Tsunami’s hit Uluru and/or unemployment rises.

The issue is leverage and equity.   If global economic meltdown happens and s/he loses their job then they have a nest egg or fail safe to be able to sustain payments providing they have paid off a portion of the loan.   This a comfortable place to be in knowing that even if the worst happens home will still be home.

So, to be able to sleep at rest, go for the interest only loan but with a leverage not exceeding say 90% and pay into that loan account every cent you can muster, live off the credit card and draw only enough to pay that credit card on the last day of interest free periods.  Two reasons, firstly it reduces interest on the interest only home loan and secondly builds a panic fund so if something does happen all is not lost.  Manage your debt and don’t let the dream makers profit at your expense.

And that is the issue.  There is nothing wrong with leverage and interest only providing you use the system to advantage and manage the debt.  I mean active hands on management knowing for example exactly when to pay credit card debt.  Know your commitments and build a simple spreadsheet of all debts on a time line so you know what needs to be paid and when.

The FSP’s know all this but prefer not to have to think about it by offering so called ‘vanilla’ home loans of principal and interest where loan exposure is reduced all the time.  This is an advantage to the FSP but not the borrower.  The FSP’s then load the interest rate for interest only to dissuade people from this type of loan because they know, if it’s managed, they will lose profit.  Worse, the borrower has no fail safe. 

CONSEQUENCES - SOLUTION TO DRUGS ISSUES AT FESTIVALS

The answer is simple – make people accountable for their free choice to take illicit drugs. Instead of expecting everyone else to pay for them to dodge law enforcement and in particular, the consequences of OD, charge the individual the full cost of any and all authorities actions.
Our society quite rightly looks after individuals in the event of mishap and this does not change with helping those who illegally quaff some hope of escape. However, when that activity is illegal and known to be illegal by everyone, then having society continually pick up the bill is tantamount to supporting that unlawful behaviour and flies against the ethos of our system of law.
Some of the so called solutions are bizarre because they accept an illegal act as legitimate which in turn undermines that system of law. Drugs are illegal and, for example, the idea of pill testing legitimises that illegal activity and compromises the Police to even be able to uphold the law. A stupid idea lacking clear thinking or indeed, consequences.
On one hand, if we get caught unlawfully speeding we cop a fine which we have to pay. We don’t expect the country to pick up the tab! Otherwise speeding would become an art form without consequences. These consequences are already well defined and accepted by everyone.
Yet, on the other hand, we cannot ignore the pile of human jetsam derailed from society because of drugs as that would be unacceptable and indeed immoral. But, as long as there is a ‘free’ safety net provided by society, the drug affected dross will continue to take advantage. As they have and do!
Perhaps, start with OD. Calculate the ‘full’ cost of having to ‘rescue’ someone and charge them the total amount to be paid as any other debt to society with well known, ‘already in place through our courts’ and accepted consequences for debt evasion. The same as any speeding fine.
I don’t know what the full cost of paramedics, ambulance, hospital, doctors, medicines etal would be but if it’s say $10,000 [perhaps 10 weeks of value adding community service or army reserves or tax debt] then charging the perpetrator [note – NOT victim] would make them think twice and at least reduce their capacity to buy more drugs.
In this case, Australia is the victim because we are held to ransom by those who play on our quite appropriate moral responsibility to help everyone in trouble. Indeed, those of self proclaimed higher moral judgment will always play the ‘poor little kiddies card’ yet offer no solution other than the wringing of hands in a most sanctimonious yet perplexed manner. But when that ‘trouble’ is illegal, self inflicted and repetitive then ultimate consequences must fall on the perpetrator, not Australia as the victim. As our system of law demands.
Think consequences. Simple.

CARS AND DEVICES

You remember, when the brats were little they used to fight over the ‘Walkman’ whilst in the back seat ignoring the wonders passing by.  Then we saw the rise and rise of technology ‘keep the kids quiet gizmos’ like TV in backrests relegating silence to the back seat whilst they still ignored the wonders passing by. 

Then, as they grew up, the poor sods developed a social enigma called Fear Of Missing Out [FOMO] which is a direct downside of the need to remain socially available 24/7 - at all costs.  They were now glued to minuscule screens on their ‘personal devices’ waiting, waiting, waiting rereading old messages whilst still ignoring, the wonders passing by.

That generation has grown up but are still glued to their minuscule screens hence the proliferation of ‘pop up’ screens on top of car dashboards keeping those same now grown up kids abreast of ‘everything’ on a second by second basis.  Emails, blue tooth, twitter, Instagram, face book and maybe even real life people actually calling.   The giant 12” screen has taken over and, the wonders still pass by.

Just look at any footpath and see the number of people with their activated ‘device’ front and centre whilst walking blind waiting for something to appear on their minuscule screens,  anything!

Addiction is obvious and it translates directly to new cars in that the cars ‘activated device’ pops up front and centre topside whilst the real world of wonders still continues to pass by.   The footpath dysfunction has been replaced by a road dysfunction.

The other day I jumped into my wife’s absolutely classically simple, immaculate  and beautiful 1988 MX5 in a feckless rage with the roof down, no radio [doesn’t work], no phone, tablet, computer, twitter, face book or indeed any connection on any device  of any kind.  I watched the wonders pass by.  I was back in the real world.

Do we need ‘connection’ 24/7?  No.

SURCHARGES - DINING

We just spent $344 for the two of us for lunch and were charged an extra $3.78 surcharge for using a normal bank credit card - including that same surcharge charged on the tip!  This is a grubby little rip off for little dollar value.  Some financially challenged so called junior manager decided to penalise anyone who doesn't keep a bucket load of cash on them when dining - may I suggest no one!  Let me put that into perspective, this charge is the same as adding circa 50c to the cost of say a main course from $48 to $48.5 as we had this day.  It's a hidden charge designed to make the menu seem cheaper - except it doesn't.  My suggestion, join the real world and make people's experience seamless without reputation ruining nasty surprises.  Think the ramifications through instead of trying to grub a few cents over and above an expensive lunch.In our job we have eaten at hundreds of restaurants all over the world and rarely encounter such backward anti-customer charging.

BUSINESS BROKERS

Want to sell your business and be assured the people you entrust to that sale are both knowledgeable and professional?  Don’t we all.

A broker is merely an expensive intermediary between buyer and seller supporting non disclosure between the parties and by validating financial and legal information leading to negotiated contractual agreements.

Unfortunately there are many so called brokers who should be in some other sort of real estate because business broking requires a deft set of learned skills so as not to disadvantage either seller or buyer.  Beware the broker who devalues a business just so they can get a quick sale commission to support their own cashflow.  Indeed, there are international methods of calculating worth remembering that ‘worth’ is not a fire sale but a true and proven financial statement showing value.

Seek the broker who recognises they have a fiduciary duty and can prove education, knowledge and results because without all three they cannot provide valid advice.

Indeed, a business broker must by necessity provide financial [valuation] and legal [contractual] advice on all matters related to both selling and buying a business and, if that advice is flawed because of a lack of education [knowledge] or for whatever reason, both buyer and seller may be severely disadvantaged. 

Brokers charge and accept significant remuneration for a ‘professional service’ being far more than the cost of just lodging an advertisement on some website.  This differentiation is critical because it means a broker has a fiduciary duty to the seller or the person paying the fees to be honest and act in good faith in all dealings.

Buyer beware because there are many ‘brokers’ who pontificate at length about their ability to sell a business yet may not have a clue other than bluster. 

In simple terms a broker must be able to prove the following and if not keep looking for one who does:

1.       Education:  A broker is supposed to be an expert professional in business valuations etc and as such needs to have some sort of financial qualification to offer that advice; at the very least at diploma level but preferably at degree or even masters level.

2.       Experience:  Whilst experience is not as crucial as educated knowledge it is desirable for the broker to have transferred their educated knowledge into sales where both parties are happy;

3.       Industry knowledge:  As a well paid mediator/negotiator it is expected that the broker has extensive industry knowledge to be able to facilitate any sale without misrepresentations;

4.       Client base:  Has the broker a good enough reputation to be able to support clients wanting to sell and buy?;

5.       Working for you:  The obligation on the broker is to represent the seller as they are paying the commission.  It is not their role to act for both sides therefore no kickbacks;

6.       Not quick turnover fire sale:  It’s worth remembering that many brokers work their sales to maximise cash flow in the short term.  Therefore avoid those who devalue a proven valuation just to get a quick sale.  They win, you don’t – a $100k drop in sale price means you lose $100k whilst the broker may lose just $5k but get $20k in the pocket today;

7.       Valuation expertise:  This is the hub of the broker’s input and where they must prove expertise ‘in good faith’.    Ask the broker to explain common terms such as ‘risk based multipliers’ and ‘EBIT normalisation’ and ‘payback’ and ‘capitalised future earnings [Nett EBIT/ rate of return] * 100 +- adjustments’;

8.       Discretionary cash flow:  This is the total owners benefit from the business including lawful tax breaks, goods and services for private purposes etc;

9.       Mitigating factors:  These are the wow and risk factors influencing a sale such as consistent and verifiable profits and hours required to sustain profit and growth potential;

The most crucial figure is proven revenue [BAS *6] from which any professional broker can deduct linked expenses at ATO published rates and wages etal, add EBIT normalisation [this is why BAS expenses are not indicative] and apply a multiplier based on risk and/or calculate worth based on capitalised future earnings and/or by detailed analysis of P&L to get an estimate of worth.  Then it’s up to market acceptance factors.

This is their job and they get paid for doing it.  If they can’t, then find someone who can.

Myer

An open letter …

Mr Gary Hounsel CHAIR & Mr Nigel King CEO

Myer Holdings Ltd
PO Box 869J
Melbourne VIC 3001  Australia

CC:  Mr Solomon Lew - Premier Investments

Gentlemen,

As a bloke who grew up in Melbourne, was educated in Brighton, spent all my formative years in abject immaturity and wasted many many opportunities I should be the last person you listen to when it comes to your charge.  Indeed one of my burnt in memories was the Myer’s man delivering something for Mum the day JFK was shot.  The 22^nd of November 1963 was an important wake up call for the world.  In a couple of days it will be 55 years ago and we still haven’t learnt that respect and trust is a God given right.

I offer that rather banal insight into history because it helps define your store.  When Sidney Myer founded his department store it was inexorably linked to the person and, if I remember, that link followed through to Ken Myer before his death in Alaska.  A ‘family’ store where people connected with the ‘name’ despite not knowing them. 

Mum used to drag me along to shop at ‘Myers’, have lunch at ‘The Birdcage’ and have the days purchases either carried to a taxi or delivered to home.  The day two mink coats turned up at home was a watershed moment in understanding marital relations between one’s parents.  Myer’s had a soul and a true understanding of people and Mum was made to feel special.

Before forging into hospitality I spent too many years downsizing companies around the globe.  A bugger of a job made all the worse because it was my role to deal with the aftermath of bad board decisions which in turn necessitated disadvantaging too many people all through no fault of their own.  My memories are a bit vague but I seem to remember an imported CEO by the name of Dennis Eck totally missing the point that Myer [note – no ‘s’] was not Coles or Target where impersonal vertical marketing seemed at home but a caring ‘family’ company.  I also seem to remember Don Argus saved the day but I can’t be certain.  The point being that personality and ethos were removed and the business suffered.

Now it seems, personality has once again been removed and business is suffering albeit with Myer still in toxic denial mode.  Look at it from an objective viewpoint – untrained staff, rows of cheapish merchandise, staff who are impersonal and confused, a store undifferentiated [and all at once]and disassociated with their customer base.  The vision has either gone or been muddled to such an extent that customers are confused. For example, remember when the bargain basement was just run-outs and odd items?  I do but it seems the ‘bargain’ mentality has infected the whole store.  More confusion.  Now, it seems that the boxing day sale is a critical tool to bolster sales because people wait for it!  Low margins are the result.  Misery.

Feel free to tear this up right now if you like because I am going to offer an opinion.  In a couple of weeks time we are heading off to Scandinavia again for a month where we will eat in something approaching 100 restaurants researching and collecting ideas for our little bistro.  A bistro which already has multiple global awards yet we still very cognisant of continuing to source global trends, service and differentiating ideas.   

And, I believe that is the key – differentiation.  Let’s take Galeries Lafayette or Le Train Bleu [within Gare de Lyon] as examples in Paris both of which we have shopped and dined in many times and both of which offer a special experience yet both are flawed in many respects.  The point is that both have held their vision and communicated that vision and, as a result, do well despite the flaws.  Now look at your charge!!

The day we saw a dog fashion show at Galeries Lafayette or watched a waiter ‘strut’ a dozen bottles of Moet on a tray above his head at Le Train Bleu burned an image in our heads.  A positive image which overshadowed any complaints.

In my opinion you have 3 types of customers.  The so called upper middle class who want the finer things and experiences, the lower middle class who want to be seen and to be treated as though their elevated position is a natural state of play and all of us seeking a bargain.  This is a natural differentiation in the real world.

I opened this letter with comments about ‘respect and trust’ and this is what I remember most about Mum’s dealing with Myers’.  Because of Myer’s ability to make people feel special my mum, and thousands of others, spent an awful lot of money therein [see comment above on Mink].  But now Myer [no ‘s’] has turned into a jumble sale where no one feels special including I daresay the staff.

The upshot is that people [like me in a previous job] are forced to cut even more staff and amenities to save a bottom line.  Spiralling into misery! 

What should Myer[s] be known for?

McEwans had it with their Vision, ‘McEwans means a million things’ and Bunnings has it with lots of stuff and cheapest prices.  Both places where Eck would have felt comfortable with vertical marketing - but, not for Myer[s].

At the bottom, the bargain basement is a place where people can go and rabbit around looking for that ‘something’ to be bought on impulse.  Why?  Because bargains are not pre-planned.  See stuff, buy stuff.  Everyone likes to fossick.  This is not cheap imported for the purpose crap but real run outs, overstocks etc as anything else diminishes the image and is best left to Target etal.  A bargain is an item reduced to sell, not a cheap product brought in to mimic a real reduction!

In the middle I believe a huge albeit simple change is necessary to cater for modern ways of purchase.  Firstly, people want to try on or view something before purchase and secondly they want it pronto. Therefore there must be a try-on size range and then at purchase the staff member who must be able to say, ‘It’s on its way’ because as soon as the money has been accepted the message goes through to a store where it’s immediately dispatched and with a non-conditional return policy.  Indeed, there is also technology allowing people to see themselves with various garments on screen [?].  When I did my MBA in the 80’s I seem to remember a French knitwear company who started to knit the purchased garment as soon as the order was received and delivered same to the customer at the speed of light.  They were a forerunner indeed!  I think much better to sell say 1,000 lines of quality than 10,000 lines of rubbish with stacks of multiple sizes jammed into racks no one can see over.  Myer[s] did not offer rubbish but Myer does!!

At the top, people want an experience and providing that experience could be the vision and saving grace of Myer[s]!   Why not rekindle Sidney as the founder overseeing a new ethos where people are made to feel special and welcome in his emporium where the best is available, champagne bars abound, the ‘Birdcage’ makes a re-entry, the Mural hall has invited glamour events, dogs have fashion parades, chandeliers light the way, lots of upmarket accessories are on display, furniture is leather, staff are trained and plentiful and trust and respect are ingrained.  My Mum would have lived there because she was made to feel special and that is the image of Myer’s I remember in its halcyon days.

Lastly, this image must be created at the City store and then followed on elsewhere.  Why?  Because nowhere else has the history or has the Mural hall.  Vision and image go hand in hand.  Indeed, the ‘top level’ may only be available at the city store, the home of Sidney. Spooky, isn’t it.

Just a small example, the ‘Hopetoun Tea Rooms’ in the Block Arcade is immensely popular because they capture something of the past whereas their competition can only look on in envy.  Image and vision!

I have been and still am at the pointy end and the coalface of business in highly competitive industries [hospitality etal] and in the past have been stupid enough to delve into so called corporate rightsizing which is about as depressing a job as you can get.  These days we run a little bistro and consult globally when I believe we can add value.

My ‘opinions’ are not mere puff but based on too many years experience.  I really felt for Myers when Mr Eck was CEO because of the diminution of a Melbourne icon to foreign standards.  Likewise when the Mexican triumvirate hit Telstra.  Why do we allow this to happen?

A department store is an icon of the past, present and future because it allows many faces within a constructed ‘life’ ethos.  An ethos which saw Myer’s rise and rise and a now a lack of ethos which foreshadows misery and failure.