Harvey Norman expects shoppers to spend over Christmas as retailer cops first strike on remuneration report

Harvey Norman chair Gerry Harvey is banking on a strong Christmas even if customers have become more price conscious. Mr Harvey on Wednesday said the furniture, electronics and white goods retailer was focusing on the middle to upper consumers, where its market share was “holding very well”. “People that might want a $3000 item now might want to pay $2000 for it, they’re a little bit more price conscious and aware,” he said. “I think Christmas will still be quite strong . . . the Christmas spirit comes into play and (customers) will go out and buy whatever they’ve got to buy. “You can only take that on what happened last year and history tells you if it happened last year, it will probably happen this year.” Meanwhile, Harvey Norman shareholders delivered a massive 81.83 per cent vote against its remuneration report at the company’s annual general meeting, copping the company a first strike. Boards receive strikes when a motion has more than 25 per cent of shareholders vote against it. It came as Harvey Norman posted an 11.9 per cent fall in comparable sales from July to November. It joins a long list of retailers reporting a decline in sales as cash-strapped consumers pull back on spending in the face of higher inflation and interest rates. Sales for the group — which has a presence in New Zealand, Europe, Singapore and Malaysia — slid 7.8 per cent over the period. “Our sales figures are still quite good compared with pre-pandemic levels,” Mr Harvey said. “It’s not a problem in terms of sales . . . a bigger problem is the cost of doing business, wages is the biggest problem.” Harvey Norman said sales had been “positively impacted” by a 10.8 per cent appreciation in the euro, a 10.6 per cent increase in the value of the British pound and a 2.6 per cent increase in the value of the New Zealand dollar. Shares in Harvey Norman closed up 4.2 per cent to $3.76. Harvey Norman is the latest retailer to post a sales slump in recent weeks. Home fragrance and candles retailers earlier this week reported sales for the first 20 weeks of the financial year fell 11.3 per cent compared to the prior corresponding period. Australia’s largest footwear retailer Accent Group this month also said inflationary pressures were eating into sales and warned demand for discretionary goods like shoes and clothing were waning. Official data from the Australian Bureau of Statistics on Tuesday confirmed the spending slowdown, with retail turnover down 0.2 per cent in October. Meanwhile, online furniture retailer Temple & Webster has emerged as one of the few bright spots for a national retail sector hit with lower consumer appetite. The ASX-listed company on Wednesday said it had started the year strongly, with sales from July to November up 23 per cent year-on-year. It also reported a successful Black Friday sales campaign, with the four-day period delivering a 101 per cent jump in sales to $17.4 million. “The Black Friday-Cyber Monday trading period continues to grow in importance as customers bring their Christmas shopping forward,” chief executive Mark Coulter said. “We continue to grow our market share at a time when the overall furniture and homewares market is down, reflecting the resilience of our business model and flexibility of our merchandising strategy.” Temple & Webster shares closed up 14.4 per cent to $7.39.