The founder of the Harvey Norman chain of superstores presents his vision of retailing in Slovenia

Well, it's not my first visit, I was first here 16 or 17 years ago. What happened was that we've been doing business with a number of Slovene companies, like Gorenje, and have been selling their products over the years, and I got to know the Slovenians that came down to Australia pretty well. And over the last five to seven years, they've all been saying to me "you should open in Slovenia". I would tell them "awe, come on", but then it got to the stage where I thought that if someone keeps going on about something, perhaps I should investigate and have a look. So I sent a number of our people over here to have a look at what might be available to buy or rent, and what the opposition was like, what the future of the country looked like, the growth, etc. And the general consensus was that, at the end of the day they all came back and said we should go. And the idea would be to use Ljubljana as a starting point and build a significant signature store there that looked good, as a building, and put a presentation in there that was better than anything that currently exists. If you do that and it works, then maybe you could look at some other places in Slovenia, and you could certainly go to Croatia, and then by the time you did that, you could well end up in some of the other parts of former Yugoslavia, such as Serbia or Bosnia.

Well, you've first got to open one and make sure it works. There's been a degree of red tape in a place like this, as well as some issues that we're not used to, such as building contracts, buying land, and the general way that people do business here is a bit different, but we've got through all those things bit-by-bit and now we're ready to open.

We became the most successful retailer, in terms of growth, in Australian history. We thought to ourselves, "we're so good in Australia, but would we be any good in other countries?". So we went to New Zealand, and it's worked there just as well as it's worked in Australia... and then we went to Asia -- we've got 14 shops in Singapore. And we're now looking at that and saying "I think we're going pretty well in Singapore -- can we now look at Malaysia or China or whatever?", so we're now looking in that direction. We're also looking at the U.K., we've got one shop in London at the moment, an upmarket furniture store. We're also opening in Ireland, hopefully in about six months. So we're doing all of these things, but we only need one of them to work for the whole thing to be more than successful. If they all work, it'll be a big bonus.

It's all of those things. When people talk about successful retailers and those that are not so successful, the customer determines at the end of the day who is successful and for what reason. We can tell immediately when we walk into a shop. You can tell -- one, by the presentation, two, by the number of staff, and three, by the number of customers. You just know. You can tell their turnover, you can tell how many people are employed. etc. If you've done it all your life, you've just got the feel.

Now for whatever reason, one shop will work a lot better than another. When you ask the people who are involved, they will tell you it's the presentation, it's the quality of their people, it's the price of their merchandise -- it's all of these different things, and it's the mixture of the whole heap of things that makes a business successful. The ones who have a passion for it do very well. And that's who we are, we're specialist retailers who do it very well. We've proven that we can do well, but what we haven't proven at this stage is that we can do well in Slovenia. But we're very optimistic because we've had a good look and we've sourced opinions from an awful lot of people. They've looked at our shops and said that we'd do very well in Slovenia. They all say that -- the feedback is very strong.

Well we've developed a culture over a very long period of time, and it's the people. Businesses are made by people. We've proven time and time again that you can have wonderful shop, and put a bloke in there who's no good, and he'll stuff it up. Put a good bloke in, and it just turns around like that. Our whole interest, ever since we've been in business, is the development of people -- key people that can do a job. It's all people related.

We have lots of systems to do that. Again, in most companies that you go to work in, if they are big chains, the possibility for advancement is not great. Shop assistants are treated as second-class people, or at least ordinary people. It's not regarded as much of a career anywhere in the world. But we're trying to change that philosophy. If you think about it, where were the great fortunes made in the last 150 years? Were they made in retail or in some other industry? The richest family in America is the Walmart family. In fact, there are families in every country in the world that have done extremely well in retail. It's been forgotten and overlooked. People have traditionally said to their kids, "don't go and work in a shop, you're going to be a doctor or a dentist or a lawyer or an artist... just don't go work in a shop". So we're saying "you're wrong, you should work in a shop because there is more opportunity there than in working somewhere else, such as for a dentist".

Well, I'm getting old so sometimes I ask myself what I like about this, why have I stuck around this long, because I don't have to, I can go and breed my horses and just take it easy. But there are a few things I like. One, I like the sense of achievement. I think once you have experienced that sense of achievement, you feel sorry for the people that haven't. Two, if you work with a lot of people and you see them develop over a period of time, such as a person who goes from a salesman to someone who runs his own business under our system of franchising, you see that they've done well. You get a lot of pride and satisfaction out of the fact that you've seen people develop.

No. It was just one store. The idea was simply to open a store, at 22 years of age. I didn't have a vision of having a hundred stores one day or being in different countries. We started Harvey Norman nearly 20 years ago, and before that we had another retail business running for 20 years.

Probably our biggest success was when we picked the right time for the computer superstore about ten years ago. That caused our business to pick up considerably. We had furniture and electrical shops that were growing and going along strongly, but then all of a sudden, the computer became the hot product. So we were the ones that set up computer superstores in every one of our shops right across Australia, and our business took off overnight. That was probably the biggest single influence I've ever seen on our stores.

When we go around the world, we try to pinpoint the people we think are really good, and try to do it better than them. We really try to concentrate on the opposition. When someone is doing something better than us, we give ourselves a flogging. And that hurts! We don't want to run second anywhere! We want to be the number one outlet. If we don't become the number one outlet, we will search and search and work at it until we get there. We are in retail because we want to be good at it, not because we want to make money or employ people or some other reason. We're in it because we want to be the best at it.

Well sure, if you look at what's happening in Australia, we've outperformed every other public company on the Australian stock exchange over the last 10 to 15 years. It doesn't matter what industry, whether retail or manufacturing or services or whatever. We've outperformed every company. I know people who put 50,000 Australian dollars into Harvey Norman when we went public in 1987, and that turned in to 7 or 8 million dollars. Microsoft and Dell have done things like that, but in Australia very few companies have ever been so successful.