The recent closure of the eight Guzman y Gomez stores in Chicago USA was a salutary message and a telling case study for Australian business owners who are confidently seeking global expansion and success. It is not easy, and typically rare.
Bunnings acquisition of the British Homebase hardware chain for a reputed $700 million was, figuratively, a disaster. After two years of converting the trading name to Bunnings and competing on High Street the group was sold for one English pound. The total loss to Wesfarmers was estimated to exceed $1.5 billion.
Smiggle was founded in Melbourne in 2003 and acquired by Solomon Lew and Premier Investments in 2007. It rapidly grew to 117 outlets throughout the United Kingdom. It was the “darling” brand name in the holding company.
In recent times its product range has been significantly reduced; so too the number of outlets.
RM Williams, the iconic Australian bootmaker, is expanding its network of British outlets with new premises in Jermyn St, one of London’s premium menswear districts. The growth projections are modest and well-founded by one of Australia’s richest entrepreneurs, Andrew, “Twiggy”, Forrest.
Time, timing, funding and an established range of some 73 footwear options will underpin the initiative.
Local success, competitiveness and dominance do not ensure initial or sustainable success in regional and global marketplaces.
National branding is challenging. Local markets are unique, different and demanding. That is evident in the coffee culture which prevails. No one retail brand enjoys Australia-wide ascendancy. Actual, or perceptual taste preferences promotes the importance of singular baristers. Coffee is a personal taste, complemented with personal preferences for “my” barister.
In recent years Australia has been the genesis of two “unicorn” corporations- Atlassian and Canva. Both startups rapidly grew to $1 billion status. That is rare… as unicorns.
This calendar year their market values have receded by greater than 50%.
It is not simply an Australian phenomenon. Global growth, and sustainable performance are difficult.
THINK BIG ACT SMALL
Ambitious plans for growth must at all times recognise and respect the presence and influence of differing local cultures, values, perceptions and preferences.
Little things count in business.
Look no further than the Australian football culture. Four codes – Australian Rules, Rugby League, Rugby Union and Soccer. Even those labels are contentious and disputed.
The issue is, not what is the game played in heaven … it’s, what is the code played, and supported locally.
Play on.
Barry Urquhart
Marketing Analyst
Marketing Focus
M: 041 983 5555
E: urquhart@marketingfocus.net.au
L: (08) 9525 3355