Physical stores come first for Harvey Norman

Furniture and electronics giant stays competitive by focusing on staff retention, in-store experience and customer satisfaction

The interiors of Harvey Norman stores are carefully curated to offer a pleasant shopping experience, says Mr Kenneth Aruldoss, the company's managing director for Asia.
The interiors of Harvey Norman stores are carefully curated to offer a pleasant shopping experience, says Mr Kenneth Aruldoss, the company's managing director for Asia.ST PHOTO: ONG WEE JIN

Over the years, furniture and electronics giant Harvey Norman has moved with the times by streamlining its online shopping platform, expanding its reach on social media and keeping up with the latest market trends.

But brick-and-mortar stores will always be its mainstay, says Mr Kenneth Aruldoss, the Australian department store's managing director for Asia.

"People want to touch and feel the products," he tells The Straits Times during an interview at the retail chain's newest store at Northpoint City in Yishun, which opened this month.

Harvey Norman, which raised the shutters of its first Singapore store in Millenia Walk in 2001, now has 14 outlets and more than 500 employees here.

Its 100,000 sq ft, three-storey flagship store in Millenia Walk opened in late 2015, replacing the old 45,000 sq ft one. The store attracts "thousands" of people every day, Mr Aruldoss, 57, says.

The business in Singapore has seen "significant growth" in recent years, he adds.

In the first half of its financial year, between July and December last year, the company saw "double-digit growth" compared with the same period the year before.

Harvey Norman's success comes at a time when the retail sector in Singapore is suffering because of stiff competition and high operating costs.

Even some internationally successful companies have struggled to survive. French retailer Carrefour and Japanese fashion label Lowrys Farm, for instance, left the Singapore market several years ago.

So how has Harvey Norman kept up in Singapore's ultra-competitive retail scene?

Mr Aruldoss, who joined the company in 1998 as a salesman, says it boils down to one very important thing: people.

"Training is a very big part of Harvey Norman's DNA... I strongly believe you need to have succession planning. Many of the senior people here are veterans. They have been with us for many years," says Mr Aruldoss, who was born in Singapore and is an Australian citizen.

He reveals that the staff retention rate for the Singapore office is "nearly 90 per cent".

"Most people aren't aware how much a retail manager at Harvey Norman can earn," he adds, though he declines to reveal how much.

Harvey Norman is also particular about offering a pleasant in-store shopping experience.

The interiors of the stores, from the lighting to the layout of furniture, are carefully curated.

Stores must be tidy, clean and have a wide range of furniture to appeal to women, a key group of customers who tend to be more selective.

There are also special in-store features, such as a Games Hub, which can be found in the two-storey 34,500 sq ft store in Northpoint City, as well as the outlets in Millenia Walk and Parkway Parade. Shoppers can test gaming equipment by playing games and can also try virtual reality and racing car simulation at the Millenia Walk store.

"People will spend thousands of dollars on gaming," says Mr Aruldoss, who also keeps a close eye on consumer trends in countries such as the United States.

Having an effective online platform has helped the business.

While most of its customers shop at the physical stores, some do so online and about half of these opt for "click and collect", which means they pick up their online purchases from the physical outlets.

Having a comprehensive range of products and staying accountable to customers from start to end are also crucial, Mr Aruldoss adds.

The retailer's Shop With Confidence campaign has helped to build trust, he says.

Buyers, for instance, are given a price guarantee. This means that if a customer buys a product from Harvey Norman and finds the same item for a lower price at another store, Harvey Norman will match the lower price and top up 10 per cent of the price difference within 10 days of the purchase.

Customers can also have their goods exchanged and refunded, reserve items, enjoy same-day delivery and have their products replaced or serviced.

These policies go some way towards retaining customers, including millennials, who are "very price-conscious" and also want to shop with ease, says Mr Aruldoss.

He adds that products popular with millennials include headphones, computers and televisions.

"When customers have problems, we bend over backwards to fix the problem.

"A happy customer is also a repeat customer. They will spread the word and no form of advertising can beat that."

Shopper Yang Jing Xi, 23, bought a hairdryer from the Northpoint City outlet during its opening sale this month.

The undergraduate says of the new store: "It has more areas that showcase how to place furniture. The pricing at Harvey Norman is good... Ultimately, it's the pricing and the familiarity of the name."

A version of this article appeared in the print edition of The Straits Times on January 27, 2018, with the headline 'Physical stores first for Harvey Norman'. Print Edition | Subscribe