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Gerry sticks it to Allan

Gerry sticks it to Allan

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If Allan Fels's ears were burning on Tuesday, it was most likely from the lambasting Gerry Harvey gave him at Harvey Norman's annual general meeting of shareholders. "You would swear we were in Nazi Germany and it was 1940," he told the meeting.

"I've yet to find one person who thinks we did anything wrong. We have been pursued relentlessly."

Harvey was speaking of the long-running dispute between Harvey Norman and the Australian Competition and Consumer Commission over a GST software bundle sold by the retail giant in 2000 ("ACCC takes on Harvey", ARN (print) November 20, page 1).

"You look back at sales," he explained of the ordering process. "You know it's June and there's GST and there's going to be some extra, so we ordered 2,000 [stock-keeping units]. I thought 2,000 sounded OK to me. You know what software is like -- it sells for $200, it costs $2 to make, and a year later it's worth [less than] 10 bucks. So we gave away that software.

"There was unprecedented demand. Our computer stores went crazy and 2,000 of these things sold as soon as they hit stores."

If there is a man to take on Allan Fels, it is Gerry Harvey. His place as chairman and major shareholder of the company means he is in the position to speak out against the ACCC -- and speak out he did. According to Harvey, there are many others who feel the same way.

"I hate him with a passion," he said. "If you knew what he did to some of our people . . . he's got nothing to be proud of. The quicker he's gone the better.

"I speak to other managing directors and they say, "‘Get stuck into the bastard -- I wish could do it'."

The ACCC investigation was initiated from four complaints from consumers. Nine Harvey Norman employees were hauled up to give evidence, including finance director and company secretary John Skippen and computers and communication general manager John Slack-Smith. They are now bound by confidentiality agreements.

"They were taken and interrogated by a barrister like they do on TV," Harvey said. One staff member was so upset by the ordeal she broke down and cried, he said.

The ACCC investigation also drew the wrath of shareholders. "I had 30 years in the computer business, and I can't believe this issue with software," said one shareholder.

Harvey wants someone to watch the watchdog. "Why shouldn't there be some mechanism between us and Fels? There's no way to get through the maze."


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