We have been reflecting on the various results which have emerged from retailers over the past week or so, and the variation that has occurred between each. We believe that the reason for the variations is one of “consistency”. Let’s explain.

The Warehouse Group reported recently the need for a review of their expected profit forecast for the year, and based their review on the unusual weather throughout the country which impacted on sales! The unseasonably bad weather apparently left the company with an over-supply of certain apparel items, thus requiring a high level of discounting to clear the stock. Conversely, the Briscoe Group suggested annual profit for the Group would be up by 25%, as a result of good marketing both before and during the Christmas trading period.

Reports from other retailers such as Pumpkin Patch, and Hallenstein Glasson, suggest the apparel industry is particularly under fire. The announcement by Woolworths Australia that they are going to close a significant number of Dick Smith stores and then sell the brand also attracted headlines during the week. Hot off the press has been an announcement that Bunnings New Zealand is planning an additional store in the heart of New Plymouth, and are due to open a new Bunnings in Hawera next week. So what’s all this “consistency” business and how does it affect these brands and others?

The supermarket business is an example of “consistency”. The two and only companies of Progressive and Foodstuffs dominate the supermarket business. There are always subtle changes in each, but due to the fact that all consumers have to shop in a supermarket, the trading performance of each group is “consistent”. Management changes may affect the outcome on occasions, but generally there is little that changes for the consumer. So why do we see such variations when we discuss other retailers’ results?

The Warehouse has experienced management changes over recent times and with that has come a change in direction. Compare these changes to the likes of Briscoe who have had an unchanged management structure for years. The results are “consistent” with the respective outcomes. Therefore the need for a “consistent” approach to the running of a business is essential to the result regardless of whether there may be management changes. This comes from the Board of the company, who gives the direction in which they want the company to go, and then allows the CEO to take control of the day-to-day running and to implement that direction. A good example of this, which can be compared to The Warehouse, is Costco. This is predominantly a USA and Canada based company with its headquarters in Seattle. It has recently opened 3 stores in Australia. Its principal philosophy has been to reward employees of the company well, have product demonstrations in store, and to buy product which is top of the line. The group has a membership system which entitles you to shop in any store worldwide, as long as you maintain your membership of $50 (or thereabouts) per annum. The result is a predominantly upmarket customer demographic. The results both in terms of sales and profit are generally “consistent” with the direction of the Board. This company has not changed its fundamental philosophy for years. The Warehouse brand has campaigned around its “where everyone gets a bargain” since its inception. Has the time come to change this? Are there just too many retailers out there now offering the same branding message but not actually saying it?

The appliance and electronic business is another which must be “consistent”. Recently, we have watched Dick Smith change its marketing in an obvious attempt to attract customers from competitors. This may have been an instruction or direction in an attempt to offset the overall decline in the brand’s results. The introduction of the “Good Guys” also adds to the competition. However, can they compete with the “consistent” message of both Noel Leeming and Harvey Norman? These retailers have been “consistent” in recent years with their approach to product discounting and generally challenge others to meet their offerings.

The fact that Bunnings are going to open a new store in New Plymouth is “consistent” with their strategy to grow the brand in New Zealand. More importantly however is that fact that the premises to be occupied were previously occupied by Placemakers. It was unheard of in previous years for a major store to vacate in favour of a competitor. Now it is becoming more common. Does this suggest more fallout in the DIY business? Both Bunnings and Mitre 10 Mega are dominant in DIY. The latter has significantly more national sales as a group than Bunnings, but both are “consistent” in their intent to secure additional market share. They also carefully protect their respective trading positions, and Bunnings have a much greater level of competition than they do in Australia. What does seem certain is the decline of competitor brands to both Bunnings and Mitre 10.

“Consistency” is a formula that is not often discussed. However, it plays a huge role in the direction of companies and their ability to survive both good and difficult economic environments.

SHAREWATCH – BRISCOE GROUP

Briscoe Group, the company behind the Briscoes and Living and Giving homeware stores and Rebel Sport sporting goods stores, recently announced its full year sales.
“Same store” sales for the year to February 2012 were up strongly across the group, rising by 7.99%. Actual sales rose by a smaller amount: 4.47% for the year. The difference is due to various stores closed over the year – earthquake-damaged stores in Christchurch, and Living and Giving stores shutting down around the country. “Same-store” sales rising faster than actual sales seems to be a common trend at the moment, with many retailers losing stores in the Christchurch CBD but making those sales back in the less affected shopping malls.
The group had a good fourth quarter to February, with “marketing initiatives” credited for boosting sales through Christmas and after. Overall, Briscoe Group expects profits for the year to be up on the previous year, a good result given continued economic uncertainty.

IN THE PRESS

LOCAL AND INTERNATIONAL MEDIA HIGHLIGHTS 31 – 7 FEBRUARY 2012

Chic grocer deal reduces milk costs
Nosh Food Market is calling on retailers to join in the milk affordability revolution as the boutique grocer drops its prices to $1 a litre. Nosh says margins are excessively lofty and it hopes the lowered cost can continue indefinitely if competitors as well as other parties get on board.
(Source: NZ Herald)

BurgerFuel chain steps out in Iraq
New Zealand’s gourmet burger chain BurgerFuel has opened its first store in Iraq and the company expects to open its first Burgerfuel Egypt store late 2011. The burger brands success in Australia has been less overwhelming when compared to it’s other international accomplishments.
(Source: Inside Retailing)

Profitable year for French luxury goods giant
French luxury goods giant LVMH had a successful 2011 with net profits above €3 billion in spite of the uncertain global economy.
(Source: NZ Herald)

Dick Smith slims store numbers
Up to 100 New Zealand and Australian branches of electronic retailer Dick Smith face closure as its parent company announces a shift in focus to its larger format business and a cull of underperforming stores.
(Source: NZ Herald)

We are now on the cusp of a new year really starting. We say “cusp” as with a Waitangi day holiday still to come the holiday season will really only finish next week. This period introduces to us new “rules” for the New Year, whether they be a simple determination to change and try new things personally, or for children who are having their first day of school and for who growing up really starts.

Rules, however, seem to change from one person to another. There have been a number of rules that have been applied recently that don’t seem to have found favour in various circles. All of the issues apply to property. First was the approval last week for a Chinese-owned company to purchase the Crafar farms. Here we have a situation where the farms were put into receivership and were put up for sale. A New Zealand consortium offered a price $50 million below the Chinese offer. The Chinese offer was of course accepted and approved by our Government. So what’s the big deal. An offer was made and accepted. The “rules” were applied and the Chinese company obliged. End of subject. Some of us may squeal but the facts are straightforward. The receiver accepted the best price, like it or not.

The next example is the proposed development of a property in Auckland by John and Michael Chow of Wellington fame. The property is opposite the Sky Tower and has been in the news due to the fact that the previous hotel on the site collapsed whilst having restoration work done on it, to allow for a conversion to a “bordello”. We like that word: it’s better than any other to describe the use. First off, owning a “bordello” is now not illegal as long as the “rules” are applied to location etc. Secondly if you manage to apply for and achieve a resource consent for the building, then you are abiding by the “rules”. The Chow brothers have done just that. If they get consent then they are entitled to build the building on the site and to apply the use. So what’s the big deal? They have applied the rules and worked within them.

Mr Dotcom is the next one. He arrives in New Zealand and is accepted as per the immigration “rules”. He purchased NZ bonds to the value of $10 million and purchased other property and employed people. The question of guilt or otherwise, as it relates to his company, is absolutely another question and debate. He is in the country legally and has followed the “rules”. People who have been or are employed by him would be happy to have a job, as would anybody who sold him property. Therefore the question of entitlement is answered. He was given the status and that cannot be ignored.

It certainly is an interesting subject. Why is it that we accept certain “rules” but deny others the opportunity of following them when it does not suit us? So as we enter 2012, assess the “rules” and follow them, whatever the outcome; as long as you do that then you are within your rights.

SHAREWATCH – SMITHS CITY GROUP

Smiths City Group runs the Smiths City, Powerstore and LV Martin chains, and is centred in Christchurch. The company released its half-year report on Friday, covering the six months to October 2011. Overall, operating revenue was flat at $109.9 million, but the company managed to increase profits from $790,000 to $1.643 million, a significant improvement. According to Smiths City Group, the increase is due to its Risk Management program, “which enabled it to recover and commence trading in Christchurch quicker than its competitors”. This underscores the importance of contingency planning!

On a “same store” basis sales were up 20%, but this is a somewhat misleading indicator for a Christchurch-centred business: two stores, including the flagship Smiths City store, were closed for the entire period as a result of earthquake damage. Many Christchurch retailers have experienced similar same-store gains as consumers switch from the closed stores to those that are still open.

Overall, this result is a good improvement for Smiths City Group and the company is understandably pleased with its efforts.

IN THE PRESS

LOCAL AND INTERNATIONAL MEDIA HIGHLIGHTS 23 – 31 JANUARY 2012

Growing port will shrink harbour
Plans to expand Auckland’s port 250m into the Waitemata Harbour are going through the Auckland Council for official approval without a full public debate. Ports of Auckland has asked councillors to “lock in place” a coastal zone allowing it to expand its waterfront operations from 77ha to 95ha by 2055.
(Source: NZ Herald)

Kiwi tailor expands retail chain
New Zealand suit aficionado Rembrandt is to develop a trans-Tasman chain stores under its own brand, after effectively testing the concept in Sydney’s tough market. The first of three to open was Rembrandts 288 Broadway store, in Auckland’s Newmarket fashion precinct.
(Source: Inside Retailing)

Aftershocks setback Christchurch rebuild
Christchurch’s pre-Christmas aftershocks are said to delay the rebuilding process by several months, the Reserve Bank believes. Governor Alan Bollard forecasts 2014 to be the year the majority of the city’s reconstruction will take place
(Source: NZ Herald)

NZ whisky firm considers carefully
The New Zealand Malt Whisky Company mulling over the location of it’s 1.7 million distillery site expects to decide by the end of the year. The firms focus for 2012 is production, with either a Dunedin or Oamaru character building site likely.
(Source: NZ Herald)

So much has happened of interest in the past week that we have to be disciplined to ensure we don’t overdo this introduction. Last week we concluded the NIB with the potential impact from the Costa Concordia on the Costa brand, and cruising generally. What we predicted turned out to be accurate. The various cruise companies were very quick to assure their existing and potential clients of the high level of safety that is in place. It begs the question, however, of how quickly in good times we can lose the focus of key elements of our business.

In the past week, there have been reversals of fortune for many companies, including Michael Hill, Pumpkin Patch, retailing in Auckland and Christchurch CBDs, Megaupload.com, and South Canterbury Finance to name just a few, and a reversal of the performance of the Dow Jones. It’s appropriate we comment on each.

First off, and briefly, the SFO have 5 unnamed individuals lined up in respect of a $1.7 billion action. Interesting isn’t it that the “picketers” who were vigilant in defence of the late Mr Hubbard are now nowhere to be seen? Pumpkin Patch has closed its UK stores, due effectively to compounding problems driven by the economic pressure that has hit Europe. Is this a surprise? No, as many retailers have experienced the wind of change. However, is there a signal here that things are not well in the group? To retrench to Australasia does not answer shareholders who are left pondering why the group expanded to the UK in the first place. Think of the competition that already exists there. Is this another example of getting too big for your boots? The consequences for the brand could be considerable and some work in the trenches will be required before Pumpkin Patch recovers.

Michael Hill indicated that their Australian operated stores were not trading as well as expected. In fact the results of all MH outlets in the half year to 31/12/2011 were not flash. Same-store sales increased by just 2.3%. Australia accounted for 65% of total revenue and its sales were down 0.5%. It doesn’t sound a lot, but the Aussie market is far and away the largest proportion of the group’s performance and the results will be a little nerve-wracking for the company’s investors. We are always a little perplexed at the commentary given to this group. At the end of the day, it’s the publicly listed companies that are covered in the media while private companies tend to fly beneath the radar. It seems to us that the privately owned James Pascoe Group would be a pretty strong competitor. They have more than 450 jewellery stores across Australia, including the major Prouds, Goldmark and Angus & Coote chains. They also operate some 60 Pascoes, Stewarts Dawson’s and Goldmark stores in New Zealand. Conversely Michael Hill has 150 stores in Australia and 50 in New Zealand, plus another 40 in the US and Canada. So is there a pending bubble bursting in MH? We doubt it, the revenue generated is still very significant across all countries, but Australian revenue is very important to the total group’s survival over time. However, there must be a question mark over Canada and the USA being viable. These are stores in very large countries. The ability to maximise the brand and the cost of doing so must be very significant.

Some of you may have also read over the holidays that there is a pending move in Auckland from the CBD to the Britomart area for some powerful apparel fashion brands. We don’t think this is isolated; it is a move which may encourage others to do the same. The RWC demonstrated the desire of Aucklanders and visitors to support the food and entertainment facilities in the Britomart, Viaduct and Wynyard Quarter areas. The result is that not only food and beverage operators but also genuine retailers want to promote their wares in areas where people are going to be. In Auckland, that’s the waterfront or nearby. It does demonstrate yet again to us, the lack of foresight of the previous ACC and ARC by not supporting the creation of a new stadium on the waterfront rather than just tarting up Eden Park. The location simply would have been much better for all concerned, and it’s where people want to be.

While we give great support to our friends in Christchurch relative to the ongoing shaking of this wonderful city, isn’t it now timely to abandon any idea of rebuilding the city in its present from and to move forward with a simpler resolution. It’s a fact of life that the bars and restaurants and retail in the suburbs of Christchurch are trading very well. This is where people want to be. Safe environments in low-level structures. The people of Christchurch have adapted themselves and are over the CBD. Isn’t it time for the city fathers to do the same?

Finally we must comment on Megaupload.com and the Dow Jones. Most of you will be aware of the legal process underway with regard the former. This whole “web world” environment is almost too much for most of us to understand. Do we as individuals have the time available to “tweet”, and do most of us really care? Has the communication of our lives jumped into an age that we no longer control? Are we all robots who just follow the lead of others? Unfortunately we are all caught up in it, but it’s an individual decision as to how long or how much we want to dedicate to the Internet and its relative connections.

With all that comes the realisation that some parts of our world are out of our control. So why would we comment on the Dow Jones? This past week was the third week in a row where the Dow Jones experienced successive gains. Is there a signal here? Most definitely. Watch the Dow jump over 13,000 points in the next couple of weeks. Despite the last couple of years of financial decline of the USA market, the country is now starting to respond. With that will come an economic recovery. So that’s a positive note to end on and to start our New Year. All is not gloom.

SHAREWATCH – TRADE ME

Today Share Watch takes its first look at Trade Me, the well-known online auctions business. Actually, there’s more to Trade Me than just the auctions – in the 2011 year, “general items” made up 48% of Trade Me’s revenue, with the rest coming from Trade Me Motors, Trade Me Property, Trade Me Jobs and other businesses.

Trade Me’s come a long way since Sam Morgan started it in 1999 – it was sold to Fairfax Media in 2006 for $700 million, and Fairfax sold off around one-third of their shares in December, when the company was listed for the first time. Based on current share prices it’s now worth more than $1.1 billion.

Trade Me had revenue of $128.8 million for the 2011 financial year, with EBIT (earnings before interest and tax) a very respectable $93.5 million. Trade Me is not a retailer itself, unlike Amazon.com, but there are plenty of retailers who sell through the site, and that means that it’s worth looking out for.

IN THE PRESS

LOCAL AND INTERNATIONAL MEDIA HIGHLIGHTS 16 – 23 JANUARY 2012

Wool prices drop
New Zealand commodity prices fell to their lowest levels in a year, guided by declines in skins and wool.
(Source: NZ Herald)

Korea enticed by pizza from Hell
New Zealand pizza chain Hell Pizza will open its third retail site in Seoul next month, with a further seven outlets planned.
(Source: Inside Retailing)

Rotorua forest grows mountain biking trend
A study by Crown Research Institute Scion shows the economic value of recreational mountain biking in Rotorua’s Whakarewarewa Forest is close to five times greater than annual timber revenue and looks set to rise as promotions increase awareness of what is on offer.
(Source: NZ Herald)

Auckland CBD heart’s New World Metro
Foodstuffs Auckland has marked Valentine’s Day as the official opening date for Auckland central business district’s second biggest new supermarket. The New World Metro store of just over 1000sqm is located on Queen St opposite the intersection with Shortland St.
(Source: NZ Herald)

Welcome to 2012. Some of you may have enjoyed some good weather over the break, and if so, well done! For those of us in the north of the country, it was generally wet with little abatement. However, as we enter this first working week of the year it is apparent that the weather has turned a corner and is going to show some serious improvement. Murphy’s Law!

So what has been going on while we have all been relaxing? First off from RCG’s perspective, we are spending some money on improving our website. The new presentation should be completed by February so look out for our new sparkling image and better information emerging from www.rcg.co.nz. There is also an article coming out in the February issue of “NZ Retail” magazine which devotes some space to the new “Z” rebranding of the old Shell petrol stations. RCG will be mentioned so we will support the article with an advertisement outlining how we contributed to the conversion. There was much to think about during the break, all of which needs a mention, so here’s a few observations as we move rapidly into the New Year.

The use of the internet and social networking was never more to the fore than during this past holiday break. It was also fuelled by wet weather and the need for indoor rather than outdoor activities. Checking retail prices before we made a purchase, finding movie tickets, buying travel or booking accommodation, visiting shopping sites such as Amazon or local retailers were just a few indicators of how we are relying more than ever on this new communication and search facility that is now available to all of us in a matter of seconds. So is this rupturing the retailer? Not in our view, it is merely another vehicle for selling merchandise and giving our respective brands some decent exposure. Hence the RCG decision to smarten its online acts up also.

Nevertheless, we had a few debates over the holidays as to the impact of all this modern technology. Simply put, we are crazy if we don’t use it wisely and to our respective benefits. It saves leg time and without doubt gives us the opportunity of researching from our living rooms. Therefore the package available online is what will convince the consumer to make a purchase. OK then there must be an impact on retailing? Not at all. Of course we are all price driven, that never changes. The better the deal then the more you will sell regardless. The use of technology is merely a window for our merchandise. No different to the traditional shopfront. All we are offering is a greater opportunity from which to select. If we all compete on the same playing field, then the better the web site, the better the opportunity for more sales. A couple examples of how one benefits the other is the mobile phone market. The respective dealers were inundated over the holiday period, both online and physically. This proved the point that there is a need for physical contact. “How do I use the phone?” being a common theme, you need personal contact. “Show me how to use it?” The same applies to the purchase of a television or any other gadget we are keen to purchase. We need “knowhow” over and above what is available online.

If this is extended to the supermarket business, we are all inundated with offers, direct to our email address if we are “Onecard” customers. The supermarket operators are aware of what we buy and in advance advise us of the specials that are available based on our previous supermarket purchases. We cannot escape being pursued. Westfield are also using this modern form of communication as they see a need to convey specials to their customers.

Over the summer break, there have been sporting events and world events that have reached us in seconds from occurring. One example of this which will impact, was the scuttling last Friday, on the shores of the tiny Italian Island of Giglo of the cruise ship Costa Concordia with 4,200 passengers and crew on board. What does this have to do with retail and property? Plenty actually. In the first instance, it’s a branding nightmare. The whole Costa brand will be affected as to its safety, and the effect will flow on to other cruise ship companies. They will all be scrambling to convert the comfort and style marketing images to one of safety. Further, coach companies will be using the opportunity to convey their safety and convenience opportunities over cruising. Some of us at RCG have cruised previously and recently cruised on the Costa Mediterranea, a sister ship of the Concordia. There was little English spoken on board and the jostling that went on among the predominant Italian passengers as one boarded the ship would not bode well for a satisfactory evacuation. Cruise lines have huge property, vessel and major retailing interests worldwide. This untimely and sad catastrophe, in the shallow and calm waters of an Italian island, demonstrates that nobody in business can rest on their laurels. Health and safety and image are all part of branding. Hence the need for us to all constantly review what we have on offer. The Internet and social net working facilities are merely a vehicle for delivering a message: we all remain responsible for the ultimate product delivery and the satisfaction of our customers. Welcome to 2012.

SHAREWATCH – MICHAEL HILL INTERNATIONAL

Michael Hill International recently released their trading results for July to December 2011, and overall, the results are quite positive. New Zealand sales were up 9.9% on a same-store basis, while Australian sales fell slightly.

Michael Hill didn’t provide profit figures, but the sales boost in New Zealand is a good sign for profits here, and a good sign for the retail sector. The company noted that “retail has been challenging” in Australia, and that lower margins there “will adversely impact on profits”.

Michael Hill also has smaller operations in Canada and the US, and same-store sales in these countries also grew – by a significant 23.5% for the US. However, both the Canadian and US operations have tended to lose money in the past.

Overall, Michael Hill expects that EBIT will be up slightly for the half year.

IN THE PRESS

LOCAL AND INTERNATIONAL MEDIA HIGHLIGHTS 2 – 16 JANUARY 2012

Ethical shopping comes at a price
A Weekend Herald experiment has found that shopping with a conscience can add a quarter to the weekly food bill. The research found an average supermarket shopping bill jumped approximately 26 per cent when standard food items were replaced with ethical choices such as local, organic, free range and Fairtrade.
(Source: NZ Herald)

Kodak framed for possible bankruptcy
The suspicion that an icon of American business could have an unstable future pushed investors to dump stock in Eastman Kodak recently. The photography pioneer’s shares fell to a new all-time low after the Wall Street Journal reported that Kodak is grooming for a bankruptcy filing “in the coming weeks” should it fail to sell a trove of 1100 digital-imaging patents.
(Source: Inside Retailing)

RWC boost remains largely unseen
A recent Tourism Industry Association New Zealand survey has found just over half of tourism operators in believe the Rugby World Cup didn’t provide the tourism boost expected.
(Source: NZ Herald)

Kiwi fashion brand warms NYC
New Zealand Merino Wool apparel brand Icebreaker continues its international development, this month they open their second New York City store, a 1200sqft retail shop in the Meatpacking District. This store will position the brand within fashion retailers such as Hugo Boss and Stella McCartney in what is rapidly becoming New York’s urban fashion centre.
(Source: NZ Herald)

Well, we made it. Another year done and dusted. Those of us at RCG will be pleased to take a rest and recharge the batteries for 2012. So did we all have a good year? We believe so, despite the economy, we will all end up being able to celebrate the festive season with our respective families, so that must be an achievement in itself.

In the past week, some of you may have seen that there was a fire at the Rotorua Central Mall, a shopping centre that RCG has been closely involved in since it’s inception, in 1992. The fire destroyed the Warehouse Stationary store completely. Fortunately the fire was contained within one environment and did not spread to other stores in the complex. What came out of this episode was the fact that in regional locations everybody joined together to give support to each other. The fire brigade responded quickly and controlled the ultimate outcome. The Rotorua District Council confirmed that it will support any quick rebuild with a positive approach to the consent process. All in all a positive result for an untimely event.

As we enter the festive season, it is important that we follow the theme from above. Support each other, stay safe and ensure you return turn healthy for 2012. From all of us at RCG, we have enjoyed bringing you the NIB on weekly occasions and we look forward to bringing you more good news in the new year!

SHAREWATCH – ON HOLIDAY!

Sharewatch is now on holiday and will be back in the new year.

IN THE PRESS

LOCAL AND INTERNATIONAL MEDIA HIGHLIGHTS 12 – 19 DECEMBER 2011

Melbourne pop-up ‘de-stresses’ retail silly season
Melbourne Central has created ‘Destressmas Pop Up’ – a one of its kind pop-up on the second floor to help recuperate tired Christmas shoppers. Visitors will receive revitalizing facial spritzes, energising fresh apples and beverages, Crabtree and Evelyn hand massages, and Kikki. K ‘to do’ lists.
(Source: Inside Retailing)

Converse hits Australia
Trendy shoe and apparel brand, Converse, has opened the first of its Australian stores in Melbourne, with Sydney likely to be the next step. The 170sqm Melbourne Central site follows the brand’s global specialty store design which was unveiled just last year at the first ever US site in Boston.
(Source: Inside Retailing)

Price of wine on the rise in 2012
The price of wine is set to soar as the balance between supply and demand tensions, according to a strategic evaluation of the billion-dollar export industry.
(Source: NZ Herald)

Christchurch CBD update
All of the land in Christchurch’s central city has been cleared for reconstruction on, although several areas may require further foundation or ground work.
(Source: NZ Herald)

Thanks to those of you who read last weeks issue and reminded us that the “Park“ retail development is in Hastings, not Napier. In fact we never said it was in Napier, we simply said we had been to Napier. In any event, well read!! Also just another note on The Warehouse at Hastings (The Park). We forgot to mention last week that TWL have changed the red in their branding. It’s certainly very sharp and clean and gives the whole brand a very fresh image.

This gave us an opportunity to give some thought to branding and rewards. It’s common practice in 2011 for Retailers and suppliers to grant rewards for money spent. All companies are right into it. Classic examples are Air New Zealand with “Air Points”, then there’s a number of companies who participate in “fly buys”, American Express gives points and bonus points, and Farmers and Whitcoulls offer points on spend or vouchers, as do Countdown. So is it worth it? Yes it is and it retains customer loyalty. Much depends however on how good the offering is and how long it takes to get a reward or voucher. A typical “dead loss“ could be the AA reward system that seems to offer, at best, a $20 voucher for a year’s purchases. But as the saying goes, something is better than nothing.

Southern Cross medical care received a lot of attention last week for not rewarding long serving customers. With Southern Cross, the older you get the more you pay. As one gets older then it is odds on that your medical needs will increase. So why don’t Southern Cross help this group who have been loyal for over 40 years or so, and give them some level of benefit for their loyalty to the group? Likewise, how many of you have been with a credit card company for a number of years and you are never acknowledged for your loyalty? We are talking about specific rewards, one offs for 10, 20 year loyalty. They just don’t seem to acknowledge one off loyalty!

Then there are the banks. Many of us have been loyal for 10 or 20 years or so. Do they ever send a Christmas card personalised or a bottle of wine for being a long term customer? Not likely, they just charge more for the privilege of banking with them. Why is that? It’s a case of really being remote from the customer, and treating them impersonally. Here at RCG we place great emphasis in keeping people informed and making sure our customers are reminded that we appreciate their loyalty. A brand is built around how your customers respond and what you give them back for being loyal.

Whether it’s the New Zealand Cricket team who repay their fans with a good performance (at last) or The Warehouse who brighten up their store to give their customers a fresh feel, its important to remember as we enter the Christmas season that we would not exist if we didn’t have loyal support.

SHAREWATCH – ON HOLIDAY!

Sharewatch is now on holiday and will be back in the new year.

IN THE PRESS

LOCAL AND INTERNATIONAL MEDIA HIGHLIGHTS 5 – 12 DECEMBER 2011

Topshop hits Australian soil
UK fashion retailer Topshop has at last opened its first Australian store in Chapel Street’s Jam Factory, and clothing prices are low enough to make competitors cringe. The 1300sqm store offers personal shopping, a shoe bar, styling, and encompasses the men’s diffusion brand, Topman. This shop joins a league of 750 Topshop chain stores operated in 32 countries.
(Source: Inside Retailing)

US flagship for NZ designer
New Zealand born fashion designer, Rebecca Taylor who is now based in New York City, recently opened her new Los Angeles store. Located on the legendary Robertson Boulevard, the boutique is Rebecca’s fourth US store.
(Source: Inside Retailing)

Hidden picture theatres get retail transformation
The leftovers of two picture theatres that have been concealed from public view for half a century are part of the city’s latest retail refurbishment, featuring a café, restaurants and soon a hairdressing salon. Tucked away just off Queen St, the Imperial Laneway is a $13 million makeover of the 100-year-old Imperial and Everybody’s buildings fronting Queen St, directly behind the Michael Hill, Louis Vuitton and Gucci retail stores.
(Source: NZ Herald)

Inching closer, the $1b Westgate Centre
The long-planned Westgate Town Centre is a step closer with approval for a $27-million library and town square. Westgate, Massey North and Hobsonville are part of a $1 billion development of Auckland’s northwest that will ultimately accommodate more than 10,000 people and provide business land for much-needed local employment.
(Source: NZ Herald)

The approach of the Christmas season has everybody, commentators and potential customers alike, again focussing on retailers and what they have to offer. Retailers for their part are absolutely focussed on making sales. It’s that one opportunity in the year when retailers hopefully can make some money from customers who are “trained to spend” at Christmas. Conversely, property people are ready to relax: over the next week or so more property people will be on the golf course focussing on the next shot, with the expectation that 2012 will be a better year than 2011. The same property people will also be hoping that retailers will have a good Christmas so that they can pay their bills and move more confidently into the New Year. It’s a vicious circle, and as time has demonstrated both parties need each other to succeed.

So will retailers have a good retail trading period? Will this Christmas be the lifeline that is needed to give everybody a bit more confidence? Will 2012 be a good year for us all?

First up, we expect to see the same old comments on TV. It seems that the news media have difficulty in injecting any new stories into the festive season. The cameras will be out and about in shopping centres and retail stores and the interviews will be similar to last year and the year before, and commentators will have the same old approach, using material on consumer spend that supposedly sets the scene for a retail prediction one way or the other. Simply put, we expect this Christmas to generate some decent spend for retailers based on the simple theory that it is time to spend in consumers’ minds. Confidence therefore will return, and 2012 will be a better year for all. Hang on – what about the international credit crisis? Europe is in turmoil and the world economy could collapse. Well it could, but it won’t, and this time next year we will be addressing similar issues to those of this year. What about employment? What about it, the same people employed this year will be employed next year, and those that don’t want to be employed won’t be. That’s a pretty severe statement! No it’s not and it’s reality. Effectively, we all work hard in hard times and reap the rewards when the economy gets better. It’s that simple. Nothing changes!

However we have noticed a couple of changes in the last week, which some of you may have missed. Borders bookshops has effectively closed and been taken into the Whitcoulls stable. So the group is no longer around. Is that a pity? We think so. In our view competition and individual brands have an impact on consumers; they feel better about the ability to shop in different environments. We are not sure that Whitcoulls has changed since the Pascoe Group takeover and we will watch this with interest into 2012. For that matter, despite the level of publicity, we are still not sure that Paper Plus has got their in-store presentation right yet either. Certainly the customer will still be confused. So the book industry is still very much at risk. Why? Well the level of online shopping that is going on, particularly offshore, is gaining significant momentum. It’s inevitable that the Government will look at this level of potential trading in the New Year, and what the pros and cons are. Frankly this is a difficult area to police, and just how the book retailers are going to compete long term will be of concern. “Value” and adaptability will be the key issues that will need to be addressed by both Whitcoulls and Paper Plus in the New Year, with some urgency.

We were in Napier this last week. The new Mitre 10 and The Warehouse stores that have opened recently in the new “Park” development, appropriately named as it was the former “Nelson Park” site, are worthy of a visit. The Warehouse still promotes its “Extra” brand and without being cynical as to why, given that the store offers no more merchandise than other stores in the group, the external image is interesting and attractive. Internally, we remain a little pessimistic as to what they are trying to achieve, and we would be cautious as to the customer reaction. The Mitre 10 store meanwhile is certainly a very substantial offering and would compete very effectively with any other similar store in the country. Certainly this store in any location would give Bunnings a run for their money, and the partnership Mitre 10 now have with Columbus Coffee will certainly attract the female shopper.

Finally, for the female shopper, the fact that the Sussan brand is to be lost to New Zealand shoppers has probably gone unnoticed. The CEO of Sussan made this announcement to its New Zealand customers, advising that six stores will close and nine will be rebranded to the “Suzanne Grae” brand. This will increase the number of Suzanne Grae stores across the country to twenty. Will the brand be missed? We doubt it. However it does beg the question as to why brands come and go as they do. Companies put a lot of effort into branding and to close a chain or rebrand is a risk for all concerned. It is, however, what we have all come to expect. Nothing stays the same, just Christmas!

SHAREWATCH – BRISCOE GROUP

Last month, Briscoe Group announced their third quarter sales, for the three months to October. The group, which includes Briscoes and Rebel Sport stores across New Zealand, increased sales by 9.15% compared with the same period in 2010.

This is a pretty significant improvement, especially considering that the group has closed a number of Living and Giving stores this year. “Same store” sales were up 13.56%. Nearly all the gain was due to Rebel Sport, which had a sales bonanza during the Rugby World Cup.

For the “year to date”, i.e. the nine months to October, Briscoe Group’s sales were up 4.35%, most of this coming from Rebel Sport. Profits for the full year are expected to be higher than last year, although the key Christmas period will determine just how much higher.

IN THE PRESS

LOCAL AND INTERNATIONAL MEDIA HIGHLIGHTS 28 – 5 DECEMBER 2011

Google Maps indoor territory
Google’s next frontier in digital mapping will span the world’s airports and shopping malls.
(Source: NZ Herald)

Air NZ introduces Airpoints debit card option
Air New Zealand says new additions to its Airpoints loyalty cards could revolutionise the travel industry by giving its users the ability to load several overseas currency “wallets” up with cash, send money to other cardholders by text and buy goods from foreign websites.
(Source: NZ Herald)

City supermarket moves forward
Foodstuffs up and coming New World Metro supermarket, below the BNZ Centre at 125 Queen St, opening in the city’s CBD in March, is said to be a smaller-format store with limited space where fresh produce will be a dominant feature.
(Source: NZ Herald)

Shopping Channel aims for July
Greg Partington, managing director and part-owner of Ogilvy advertising is in confirmed negotiations with Television New Zealand to take a long-term lease of channel TVNZ7, which is being discontinued. Based on United States channels like the Home Shopping Network, the shopping channel could be up and running late July.
(Source: NZ Herald)

The events of the weekend left us with an opportunity to reflect on many issues that impact on both retail and property. The election results are a very personal matter, and are best left alone; as to the pros and cons, there has been and will be enough commentary on those issues to last us for the next 3 years. However, did you notice how many politicians were interviewed in shopping centres in the week leading up to the election? In days gone by, shopping centres were the bastion of shoppers; in fact any political electioneering was vetoed full stop. The reason being, if you had one political party in your centre then you needed to have the lot, so the best practice was to ban them all. Has that all changed? We suppose it has. In fact there is probably no control over this issue any more. How do you stop people from wandering around your real estate shaking hands and kissing babies? Or is it seen as a community activity and is therefore permitted? If you wanted to sell a raffle ticket in a shopping centre you would need permission from centre management – where’s the difference between the two activities? One assumes baby kissing and hand shaking demands a level of approval!

As for shopping, this was a hot topic over the weekend. There is just a smidgeon of optimism that the shackles of retail spending may be falling off the hands of New Zealand consumers, with an intent to start spending again in the face of Christmas. Why do we get this feeling? It’s all led by the US economy. In excess of $14 billion dollars was spent in stores on Black Friday. For those of you who may be unaware, Black Friday is traditionally the biggest shopping day in the USA and marks the opening of the retail Christmas shopping season. It follows the day after Thanksgiving. Black Friday sales this year were reported as being 6% up on 2010. Shoppers were vigilant on getting in on the bargains, and stores like Macys and Wal-Mart were shoulder to shoulder with shoppers. Furthermore, online shopping was also well up. So what does this mean for us in NZ? It’s a signal that American consumers are looking for bargains, and conversely retailers are prepared to cut their cloth to suit. It’s also a signal that there is a level of disposable income available, which in turn signals that employment has recovered a little to give both retailers and consumers some confidence in the future. Most of all, it was a clear signal from consumers that they had simply had enough of the economic downturn and wanted to spend, and they did! From a US perspective, the slowdown in the European economy has also shifted investors to again focus on America, so some positive signals that all contribute to confidence. Back to NZ. We are now over the elections; we have a stable Government which is supported by its people, which in turn gives a level of confidence in the future. We are competitive in a difficult global economy. Therefore, the brakes are off, and spending should be the focus for the next few weeks. So retailers should be confident in the potential for a satisfactory Christmas trading period. However, a word of warning, retailers should open when the consumers are available, and keep their margins down, thereby incentivising shoppers.

The election results also led us to focus on the “baby boomer” demographic. At The Warehouse Limited’s AGM on Friday, some comments were made that the Board representatives had an average age of 62. This led to discussion about board member fees, and the need potentially for some “young blood” on the board. It’s all a bit confusing. When is young “young”, and when is old “old”? If you have medical insurance cover, then the premiums mount rapidly post 60 years, and once over 65 they rapidly increase even further. This is a clear signal that medical insurers see life after 60 as more risky than prior to it. Probably quite natural, but is that attitude about to change? No longer is that demographic group likely to take retirement as early as in the past; if they feel healthy, why not keep working? If nothing else, it helps to pay the medical insurance! Further, baby boomers all have something to offer, “experience”. Graham Evans, the chairman of TWL, is 72, but from his experience alone, he still has a lot to offer. However, the key is to ensure that if you are staying in the work force, or if you hold a position that may influence the consumer market, then make sure you understand that market.

This commentary then leads on to the property market. A considerable number of people born in 1946 and beyond will now be considering their retirement options. With this demographic growing rapidly, over the next 20 years a significant amount of property will come on the market. This will be in two forms, investment property and residential property. The former will rely heavily on tenant occupation and tenant quality. Companies owned by “old people” may affect returns for investment property, as some may just close up their business and go west, if the business cannot be sold. The housing stock will also come under some pressure with more properties being available for sale. Will budding executives want to buy these properties that offer gardening and repairs and maintenance as weekend activities? Or will they prefer to rent a risk free apartment, rather than own a home? On the other side of the coin will this then generate the need for more rental properties, which will introduce an opportunity for property developers and investors? An indication of this “risk” was the statement from Pumpkin Patch, that in light of the downturn in their sales they would be seeking rent reduction from their landlords. Furthermore, they suggested that they may not renew leases where the landlords are not prepared to take a cut in rental. All pretty threatening stuff, but indicative of the market. We wonder if Pumpkin Patch will suggest a rental increase when the sales improve?!

It’s a fascinating time in which we live. “Old” can be “young” depending on your point of view, and what you want to achieve. If you’re “old”, the only risk you have is how much time is left to do all those things you want to do, while you can. So let’s close where we began: the elections. Who actually voted for NZ First when they were to all intents and purposes “over the hill”?

SHAREWATCH – DAVID JONES SHARE PRICES

David Jones is an upmarket department store chain in Australia, with 37 stores in prime retail locations. For the year to June 2011, “DJs” had sales of AUD $1.96 billion, down 4.5% from the previous year – although 2010 included an extra trading week. The company made profits of AUD $168 million, which were essentially flat once the impact of the extra week is removed.

It’s interesting to look at David Jones’ performance over the longer term. In the last five years (2007-2011), David Jones have had flat sales, and declining “sales per square metre”, but they have managed to reduce their Cost of Doing Business and grown profits quite significantly. DJ’s annual report mentions that the company still has some cost efficiency improvements to make, and presumably, profits could keep growing in the future, especially if the Australian economy starts to bounce back. Over the last five years, David Jones has taken a very different path from Kirkcaldie and Stains in New Zealand…

IN THE PRESS

LOCAL AND INTERNATIONAL MEDIA HIGHLIGHTS 21 – 28 NOVEMBER 2011

BNZ unveils swipe phone wallet trial
Bank of New Zealand has unveiled a trial of a phone with an embedded chip which is able to make payments by swiping the phone against a card reader, similar to Google’s Wallet trial in America. The trial is being done by 44 BNZ and Vodafone staff over a three month period; “What we’re testing here is the viability of a true, mobile wallet that will eventually allow people to replace multiple pieces of plastic with functionality embedded inside their phone. It’s going to make smartphones even smarter,” said Paul Tait, BNZ’s Head of Channels Innovation.
(Source: NZ Herald)

Port strike causes issues for Christmas retailers
Maritime Union workers striking at the Port of Auckland are causing issues for retailers further down the line in the run up to Christmas. Ports of Auckland has received a second strike notice which will run from Thursday, December 8 to Saturday December 10, on the back of strikes from December 2 to 4.
(Source: NZ Herald)

Topshop plans store closures
Sir Philip Green, owner of UK-based Arcadia Group, says he plans to close up to 260 stores over the next three years as rents come up for renewal. Arcadia Group owns the Topshop and BHS chains, Topshop is about to debut in Australia as part of a global expansion program.
(Source: Inside Retailing)

India expands retail to foreigners
India’s government has announced it is majorly expanding the nation’s vast retail sector to global supermarket chains in a reform that could bring on a consumer revolution. This is the Indian government’s boldest economic reform to date.
(Source: Inside Retailing)

Our recent commentary in respect of The Warehouse and its future, coupled with Kirkcaldie and Stains’ performance (as recorded in last weeks Share Watch), made us think about where the Department Store – and for that matter, the Discount Department Store – business is heading.

We were also delighted to hear this week that Kiwi Income Property Trust are injecting significant development funds into the redevelopment of the Centre Place/ Downtown Plaza complexes in Hamilton’s CBD, combining them into a single major retail destination. This development will include the closure of part of Ward Street, and the creation of a pedestrian link between the two malls. In addition, Farmers will relocate from their present secondary location in the CBD to a new 7,000 square metre store in the new development.

For those of you unfamiliar with Hamilton, this is a significant shot in the arm for the city’s CBD. The CBD has lost much of its retailing lustre in the last few years. Now we are not protectors of retail environments, we believe that retailers and developers have to stand on their own feet, and compete with others on an even playing field. Therefore, well done Kiwi for protecting your interests and investing in Hamilton. What will occur from this development is some serious competition for the Te Awa and Westfield Chartwell malls, and most importantly, some significant retention of CBD activity. This can only help the city.

So what about those department stores and discount department stores? The only activity that seems to be emerging is that by Farmers Trading Company. There is no doubt that they will have been offered a hefty carrot to relocate in Hamilton, but a 7,000 square metre store for a new development is the anchor that is needed to encourage other retailers to join the development. It is effectively the reason why new retail developments are launched. It’s a tried and proven formula. It’s ironic that Te Awa (the mall at The Base, in Te Rapa) would not have happened as a covered mall without the major statement by FTC in that development. So effectively FTC now have a serious stake in the CBD, as well as Te Awa and Westfield Chartwell. If they fail, it will affect the respective development. So how important are department stores to developments?

The list below shows, approximately, the number of stores operated by each department store company in NZ:

The Warehouse 88
Farmers 58
Briscoes 41
Smiths City 25
Harvey Norman 23
Kmart 15
H and J Smith 5
Ballantynes 3
DFS Galleria 3
Smith and Caugheys 2
Arthur Barnett 1
Kirkcaldie and Stains 1

TWL, FTC and Briscoes make up the major numbers with a total of 187 stores between them. The list highlights the significant contribution these three retailers make to retailing in this country. It also demonstrates the potential regional loyalty that consumers give to the department stores in each city. Certainly, it would be expected that per-square-metre sales by the privately owned and independent department stores would be better than the multi-store retailers. This is due to the fact that there is a better focus on performance.

SHAREWATCH – HELLABY HOLDINGS SHARE PRICES

Hellaby Holdings owns two footwear chains, Hannahs and Number One Shoes. For the year to June 2011, these chains grew revenue slightly to $166.2 million, in a “tight” market. Earnings before interest and tax (EBIT) increased from $3.3 million to $6.4 million, although there is still plenty of room for improvement.

Hannahs and Number One Shoes are both fairly mature chains, in terms of store numbers, but Hellaby have still been able to freshen up the businesses – especially Number One Shoes, which has now “completed its business turnaround with improved product ranging, branding and in-store layout”.

Hellaby states that it expects that the performance of these footwear chains will continue to improve, regardless of the economic conditions, which suggests a confidence in the businesses.

IN THE PRESS

LOCAL AND INTERNATIONAL MEDIA HIGHLIGHTS 14 – 21 NOVEMBER 2011

Kiwis flock to online bargains
The New Zealand dollars strength is a nuisance for exporters, but imports are on the rise as Kiwi shoppers flock to foreign websites to take advantage of the currency’s strength.
(Source: NZ Herald)

Google Music to battle iTunes
Internet giant Google has signed up major record firms and set itself up as the cool alternative to Apple’s iTunes.
(Source: NZ Herald)

Cadbury remains wrapped for purple
Cadbury has fought off Nestle over exclusive rights for the distinguishing purple colour it has used on chocolate packaging for more than 100 years. The Cadbury brothers are said to have selected the colour as a mark of respect to Queen Victoria.
(Source: NZ Herald)

Kathmandu eyes world wide web
Kathmandu is growing its online presence to customers in countries that could include the United States, Canada and Japan. Chief executive Peter Halkett, said the outdoor apparel retailer saw development in internet shopping as an prospect rather than a danger.
(Source: NZ Herald)

New hairdo for Hamilton Mall
Kiwi Income Property Trust has said it will spend $40 million NZD redeveloping its Centre Place Shopping Centre in Hamilton.
(Source: Inside Retailing)

It’s either a feast or a famine when it comes to reflecting on activity within the retail and property sectors of the past week. There really is little activity to get any of us excited about at present: we are effectively caught between the euphoria of the RWC and the pending elections. This state of mind or ‘limbo period” is traditional when general elections are about to occur, but the past week has generated some thoughts in our minds that we believe are worthy of reflection.

The business activities of RCG take us to all points of the country on a weekly basis. The discussion invariably revolves around business and the RWC still remains a high point of discussion. There certainly remains a feeling of “what do we do now” given that all the hype is over. It has left us with a “social vacuum” that is hard to replace. What we did discover, however, is that all is not well as a result of the RWC. Taupo retailers and most food and beverage retailers showed a decline in business this year over last during the RWC period of 15% or more. The motel and hotel people throughout the country, particularly outside Auckland, suffered from either cancelled or postponed domestic tourism business. Most people who attended RWC games were domestic spenders and as a result that spend was lost to other sectors where it would normally have been spent. We have discussed this point previously so we are not going to labour the point. However, what has surprised us is the obvious decline in commentary from RWC observers as to the outcome of RWC results. Now that it’s over, most people have lost interest in what the actual benefits were.

Our analysis is not driven by a sophisticated research model, but rather a general range of discussions, resulting in an opinion based on fact. Simply put, the economic outcome was not great from the RWC. Over time we will be fed more information once the results are known, but we suspect it will be dribbled out in a way that will provide a bit of a smoke screen to what the facts actually were. Further the actual spend and the ultimate use of the Waka and the Cloud which now sit forlornly on Auckland’s wharfs will be watched with interest. Much still to come from the RWC fallout.

So the above commentary is really all about “gut feel”, conversations with people and the interpretation of those conversations. We believe this is a pretty good barometer and gives reasonably accurate impressions. It flows on and as another example, if we reflect on the aging population, you really don’t need an economic model to understand that people are getting older and that will continue to be the case as the years go by. This will have an impact on our lives. More aged care facilities will be required, both government supplied and privately. The latter has key opportunities for developers who are prepared to provide facilities for people who may be aging but still want to partake in activity, and are not ready for the scrap heap. Effectively they are looking for a continuation of a quality life style and a residential environment that reflects this, rather than creating “boxes” for people to spend their last days in. Some developments are emerging that suggest developers are considering these opportunities, but there is a long way to go to fulfil the opportunity that exists.

The “gut feel” approach can also extend to retail activity. Two weeks ago, we discussed the performance of The Warehouse and what the future may hold for them. We were interested to see an article in the NBR (November 11th issue), which focussed on the growth of “E-Retailers”. Effectively the article suggested that the growth in this area was substantial. It devoted some comments to The Warehouse’s spokesman who described TWL activity through website sales. It suggested that there would be 2.5 million visits to its web site over the November and December periods. “E-Retailing” has also been extended to incorporate Westfield, who is now exploring and encouraging retail purchases through its email-outs! All this has a significant influence on the future of bricks and mortar. It is encouraging to see TWL undertaking a major development at Silverdale north of Auckland, on land which they have owned for over 10 years, but overall the feeling is that there is less development activity occurring than previously. We have also noticed that Air New Zealand have closed some of its Holiday Shop outlets. Is this another example of a decline in face-to-face retailing over “e-retailing”? Our “gut feel” is that this is not the case. RCG has been extremely busy this year and signals are that this will increase with more development opportunities into 2012.

This week, we will be sending out Z gift vouchers in recognition of the role RCG played in association with Z in reformatting the Shell service stations and creating the new Z retail format. This change has started to gain momentum, with very recent marketing being undertaken to influence consumers about the change and to ensure they support the new brand. The “energy” put into this change came after considerable market research. Sometimes research is essential, but “gut feel” will always be a dominant indicator, and a motive for moving forward with an idea or not.

SHAREWATCH – KIRKCALDIE AND STAINS

Kirkcaldie and Stains is a Wellington department store institution, operating from Lambton Quay. “Kirks” owns its retail premises as well as the Harbour City Centre next door, a retail/ office block.

Kirks had a relatively disappointing year to August 2011, with retail sales down 2.7% to $35.6 million. The retail part of the company made a loss of $643,000, which was a marginal improvement from the previous year.

The property side of the company suffered from higher costs and decreased revenue, because the Harbour City Centre was undergoing refurbishment and earthquake strengthening. Nonetheless, the property segment made a small profit, an improvement from last year. This is slightly misleading though – the “improvement” was only because the 2010 tax changes to buildings led to a one-off profit downgrade for the year.

Overall, Kirks has struggled during the year, but it should be in better position for 2012 as the Harbour City Centre refurbishment is wrapped up. However, the outlook for luxury retail remains fairly gloomy.

IN THE PRESS

LOCAL AND INTERNATIONAL MEDIA HIGHLIGHTS 7 – 14 NOVEMBER 2011

17 NZ jobs price of Bendon’s transtasman move
New Zealand lingerie brand Bendon restructures and looses 17 staff as their design operations move to Sydney. Twelve members of its 29-strong Auckland design and development team a expected to transfer to Australia, the company said.
(Source: NZ Herald)

Moa craft beer goes duty free
Moa Beer says it has become New Zealand’s first craft brewery to sell its products alongside champagne and premium spirits at JR/Duty Free stores in Auckland International Airport. Moa general manager Gareth Hughes said. “It’s the first time a craft beer has been offered in duty-free in New Zealand and, we’re told, the world.”
(Source: NZ Herald)

Domino’s to grow store numbers
Domino’s Pizza says it will generate more than 2500 jobs as it gears up to open 40 new stores over the next six months.
(Source: Inside Retailing)

McDonald’s $2.9b brand modernisation
McDonald’s has unveiled an ambitious plan to modernise its brand and enhance customer service. CEO Jim Skinner said the company will invest US$2.9 billion on opening 1300 new restaurants in 2012 and re-fitting more than 2400. The company earlier this year revealed a new modern look for its restaurants and will work to bring in the enhancements in coming months.
(Source: Inside Retailing)

Sunglass Hut popup store sets sail
Sunglass Hut is set to launch a floating popup store on Sydney Harbour next week, endorsing sunglasses for the latest summer season. The floating store is designed around the Sunglass Hut circle logo, includes a DJ booth and features a transparent fit-out to capture the stunning Sydney Harbour backdrop. This is the first floating pop-up location for Sunglass Hut, part of the Luxottica Group, which has more than 200 stores in New Zealand and Australia and more than 2000 worldwide.
(Source: Inside Retailing)