The sales boom surrounding GST implementation has left many small retailers out of the supply loop, but many of the Leading Edge group of computer retailers are going from strength to strength, according to general manager Ross Whitelaw.
"Some of our members are having to move premises because they have grown so much," Whitelaw said. "It is fantastic to see that kind of growth because it is what the Leading Edge Group is all about."Whitelaw said many members were moving up to four or five times greater volumes since last year with little or no supply problems, thanks to the buying power of the cooperative.
"Fulfilment issues haven't been a problem because the size of the group means suppliers can give us priority. For example, in recent months our suppliers have been able to obtain all the processors we have needed whereas smaller builders have struggled."Although computer systems and accounting software make up the majority of sales, the consumables market is also generating sales as consumers look to cash in on rebates. Retailers also realise they must absorb the additional workload of high-volume sales.
"Some owners are working 18-hour days at the moment; retailers are still getting buyers coming into their stores in a panic and wanting an operational computer system by the end of the week," Whitelaw said. "There is immense pressure on retailers with the [increasing] volumes but our members are sensible enough to realise they cannot increase the number of staff, as those volumes are not sustainable. They are working bloody hard but the bottom line is if the business is well managed, it means additional profitability." The coming months will see great changes occurring in the industry, as companies review their business practices in the aftermath of the GST.
"Obviously, there will be casualties on both the wholesale and retail side of the fence," Whitelaw said. "There is a great deal of uncertainty amongst retailers as to how to plan their budgets for the coming year.
"There seem to be two camps with independent computer retailers; those with around five staff or more who have coped well so far by allocating jobs to staff as business has gone through the roof, and the smaller retailer who is very unprepared right now for implementation but who knows exactly what they need to do and have plans in place." On the upside, the GST will help push borderline operators out of the market, and lessen the importance of "weekend computer markets".
"It won't completely fix the problem," Whitelaw warned. "However, it will make a dramatic difference because it will be much harder to cheat the system." Leading Edge is looking to further build its brand name in the booming retail market, recently developing its intranet to facilitate communications and transactions between the group, its members and suppliers, e-commerce will also be added down the track. The group plans to launch its Web site in the next few months with the aim to cement relationships between it and the consumer and drive customers to individual stores in their area.
"It is a click-and-brick solution that is becoming increasingly popular," Whitelaw said.
The group also offers central billing between suppliers and its members.
"We guarantee payment to the suppliers, so they love it. Paying on time is a very important aspect in furthering relationships with suppliers and the computer industry doesn't have a very good reputation as far as that goes. Our members are responding magnificently."