EXCLUSIVE: Major Vendors Considering Own Shops In OZ Following Internet Controversy

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EXCLUSIVE: ChannelNews has been told that three major consumer electronics vendors are seriously considering the setting up of their own vendor stores in Australia in an effort to introduce a new level of education following the recent controversy over Internet shopping.

ChannelNews has been told at CES in Las Vegas which is attended by most CE and IT Vendors and retailers that three major consumer electronics vendors are “seriously” considering the setting up of their own vendor stores in Australia in an effort to introduce a new level of education following the recent controversy over Internet shopping.

 “It will also allow us to direct consumers to either an online store or a retailer” said the marketing manager of one of the top five vendors operating in Australia.

Sony, Canon and Samsung already have their own retail stores in some countries and the recent controversy over Internet shopping has led to several vendors rethinking their retail relationships in Australia as they fear a backlash against stores like Harvey Norman who have a very high profile in the recent campaign aimed at the Federal Government.

In Australia Sony has already registered with the Australian Securities and Investment Commission the name ‘Sony Shop’ along with 19 other retail trading business names. They currently use 5 of those names to trade as Sony Central stores in partnership with existing retailers.

Several Australian vendors that ChannelNews spoke to at CES said they were concerned over the consumer backlash to a recent campaign by several retailers including Harvey Norman, David Jones, Myer and Target and that as a result of the campaign they believe that “more consumers than in the past will now turn to Internet shopping for IT products and small AV products that easily cross borders”  said one senior executive at a major vendor who spans both the IT and AV markets.

Rob Wilkinson General Manager of Toshiba Australia’s Information Systems Division (ISD) and their AV Division said that retailers were concerned about the campaign.
“In recent months several retailers have realised that there has to be a lot more education on the shop floor. We know that Harvey Norman is one retailer who is looking at better ways to service clients. We are not considering our own retail store” he said.

 Lambro Skropidis, Head of Marketing at Samsung Australia said “We already have our own stores overseas and it is something that we have looked at for Australia. Education is important”.

 

Recently ChannelNews visited two Samsung stores in Asia where trained staff were able to professionally talk their way through several Samsung product categories and then direct us to a nearby retail store where the product was sold”.

In Australia ChannelNews has discovered that product education is seriously lacking in retail stores. During a visit over Xmas to a major Bing Lee store in Sydney we enquired whether a $1,200 Panasonic Plasma had Internet capability, we were told yes, when in fact the TV did not have an IP capability. We were also told that the same Plasma TV came with “new” LED technology.

Another major vendor who was at CES said “The recent Internet shopping controversy has really created a problem for retailers in particular Harvey Norman due to Gerry Harvey’s high profile on the issue. In reality they had highlighted the Internet shopping issue and more people are now going to actually experiment with Internet shopping”.

David Ackery a director at Harvey Norman and the head of consumer electronics at the retail group said that he was not happy with the controversy that has blown up regarding the Internet.
When he spoke to ChannelNews at CES he was not aware that his Chairman had had a change of heart about his involvement in the campaign to try and force the Federal Government to introduce a 10% GST Tax on all goods purchased from overseas web sites including goods under the $1,000 threshold.

Late yesterday Gerry Harvey  told the Sydney Morning Herald that he felt his involvement was “suicidal” and that the full page advertisements during the Boxing Day sales was “bad timing”, claiming the message had been poorly communicated.

“It becomes me, Gerry Harvey and Solomon Lew – billionaires, greedy, ugly, old, out-of-date c—s, and the people writing this seem to think we have been ripping them off for years and that we deserve this, he told the Herald.

Gerry Harvey admitted that he was in a “very difficult” position.

 

“I am talking to the coalition and saying to them ‘look, we need me not commenting and other people commenting’,” he told the Herald.

Mr Harvey’s comments come as the head of the retail sector union dismissed claims that online retailing poses a threat to Australian jobs – a central claim of the big retailers’ campaign.

The Australian newspaper reported that the Shop Distributive and Allied Employees Association national secretary Joe de Bruyn described the campaign by major retailers as a crude attempt to force the Federal Government’s hand on tax policy, reported The Australian.

Mr de Bruyn said the campaign by 21 retailers including Myer, David Jones, Harvey Norman and Just Jeans was overplaying the threat that online shopping posed to their businesses.
“The vast majority of people still want to touch and feel and see before they buy something – people will buy a book on the internet because they don’t have to try it on, but most things people will go to a retail store to buy,” Mr de Bruyn said.

“I don’t think shops and shopping centres are in danger of going out of business; there’s a degree of exaggeration.”

One major vendor at CES said “It may come to the stage where we as a vendor may take the online business as opposed to letting an overseas operator take the business. This is an issue that we know has been considered already by at least four major IT vendors”.

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