“There’s been much talk about the death of the department store both around this country and globally in the last 10 years,” John King, Myer’s CEO and MD, told shareholders at the department store retailers’ annual general meeting in Sydney on Wednesday.
“But I do believe there is a relevancy for department stores, but we have to reinvent ourselves and make ourselves appropriate for what our customers want in this ever-changing marketplace.”
By that, King means it’s necessary to reduce the size and number of Myer stores in Australia, make sure the products inside them are more interesting and unique, provide more entertaining in-store experiences and back it up with a first-class digital offer.
It’s nothing he hasn’t said before, but the department store boss isn’t making any apologises for having a simple plan and sticking to it.
“If you go through our company, every team member understands what this plan is about and how important it is for us to achieve our aims of growing the profitability of this business and the profit for all shareholders.”
King reiterated his focus on the bottom line and increasing profit rather than growing sales.
“Anyone can sell a $10 note for two bucks. That’s not the game we’re in,” he said.
In addition to exiting brands that don’t provide the profit Myer requires moving forward, such as Apple, which it exited in May 2019, King believes he can still cut a lot more costs, especially in the movement of goods from the factory to the customer.
He also warned it would take time for the new brands Myer has introduced – roughly 90 so far this year – to see the same volume of sales as more familiar brands, noting that it typically takes four seasons to establish a new brand.
“You’re not going to replace the sales immediately,” he said. “Our priority is to replace the profit, and we have more than done that.”
Myer avoided a third strike, with roughly 19.1 per cent of shareholders approving the retailer’s remuneration report, below the 25 per cent threshold required to trigger a strike.
Directors Jacquie Naylor and JoAnne Stephenson were re-elected, and director Ian Cornell, who served on the board from 2014, resigned.