Latest / Best of Business / Mark Stirton: Warehouse Group CEO is 'pleased' with first half results

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Mark Stirton: Warehouse Group CEO is 'pleased' with first half results · Best of Business

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  Speaker 1: You're listening to a podcast from News Talks'd be follow
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  Speaker 2: Not a bad result for the Warehouse. It's reported a
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  Speaker 2: net profit after tacks of nearly sixteen million dollars for
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  Speaker 2: the half year, but it is warning of tough times
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  Speaker 2: ahead if the around wall drags on. The chief executive
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  Speaker 2: is Mark Sturton.
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  Speaker 3: High Mark, Hi, that how are you.
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  Speaker 2: I'm well, thank you know, I see you're opening your
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  Speaker 2: first stores in three years. This is a bit of
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  Speaker 2: a vote of confidence, isn't it.
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  Speaker 3: Yeah, you know it's part of a growth path that
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  Speaker 3: we want to get back onto. You know, we were
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  Speaker 3: closed three stores in the last couple of years and
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  Speaker 3: you know, retailer needs to be expanding, and we see
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  Speaker 3: that Magnifi area is just a really great catchment for us,
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  Speaker 3: and we're really excited about it.
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  Speaker 2: Yeah why why go Tomongafi?
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  Speaker 3: But I think it's just a growing catchment. I think
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  Speaker 3: it's one of the fastest growing catchments in the country
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  Speaker 3: at the moment. And you know, with just the communities
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  Speaker 3: growing really nasty, and you know, the ware House of
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  Speaker 3: History is all being about getting into communities and living
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  Speaker 3: in those communities and I think our offering is really
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  Speaker 3: appropriate for there. But it's the growing catchment and we
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  Speaker 3: need to be a part of these growing catchments.
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  Speaker 2: Now, obviously this is a business that has not always
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  Speaker 2: been in the best shape. So give me a status
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  Speaker 2: report on where you think it is after the tidy
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  Speaker 2: up you've already done.
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  Speaker 3: Yeah, I think it's that I'm pleased with the results,
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  Speaker 3: you know, in the circumstances and the economic conditions, and
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  Speaker 3: also acknowledging, like you say, the turnaround that job that
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  Speaker 3: we've got to do. I think we probably in the
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  Speaker 3: first third of it, particularly in the red the warehouse business.
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  Speaker 3: I think I'm pleased with where our warehouse stationary business
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  Speaker 3: is really performing, nasty and really a standout performance out
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  Speaker 3: of the three, and our not leaving business and made
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  Speaker 3: the same amount of profit that it made the whole
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  Speaker 3: of last year in this first half. So I think
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  Speaker 3: from a contribution perspective, we're happy with noles in and
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  Speaker 3: warehouse stationary, but the red business we've still got some
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  Speaker 3: work to do on margins, and we've still got somewhere
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  Speaker 3: to do on some of our assortments, which is going
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  Speaker 3: to take a little bit more time. As we work
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  Speaker 3: through some of old assortments that you know we've bought previously.
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  Speaker 3: So but yeah, I think but we're doing good cost
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  Speaker 3: control and can kind of control the elements of our
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  Speaker 3: business that are within our gam bit of control. And
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  Speaker 3: that's we've done quite well over this half on bringing
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  Speaker 3: those down.
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  Speaker 1: Yeah.
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  Speaker 2: And so do you think you've got on top of
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  Speaker 2: buying stuff, you know, being better at choosing the stuff
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  Speaker 2: that is on trend and that we want to buy.
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  Speaker 3: Yes, I think we're definitely getting much much stronger than
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  Speaker 3: when I first arrived at this business. I'm really excited
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  Speaker 3: probably for some of this year. It is probably the
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  Speaker 3: best indication of our new buying team, a new head
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  Speaker 3: of merchant house and head of planning, and I think
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  Speaker 3: that extra planning discipline that we've added to the business
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  Speaker 3: is really going to pay dividends for us because you know,
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  Speaker 3: it's better stock management, better margin control, and also it
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  Speaker 3: actually just controls risks in a in a very you know,
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  Speaker 3: more conclusive way than we've done potentially in the past.
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  Speaker 2: How do you tidy some thing like this up? Because
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  Speaker 2: I mean I would imagine that that deciding what to
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  Speaker 2: buy and deciding what Heather of Ponsonby is going to
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  Speaker 2: want to buy is quite a subjective thing. So how
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  Speaker 2: do you how do you nail that well?
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  Speaker 3: I think it's a lot of your research and the
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  Speaker 3: work that you do upfront, and some of that is
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  Speaker 3: in trends. Some of that is that you've got to
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  Speaker 3: improve your lee times. You know. One of the big
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  Speaker 3: things that we've we struggling well is that are are
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  Speaker 3: lee times are too long? So to your point is
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  Speaker 3: that if you don't touch your lee times down in
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  Speaker 3: your responsiveness, you get stuck in product that's moved on,
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  Speaker 3: you know, and their customer has moved on, so you
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  Speaker 3: know it's full. Then the buying and merchandising processes upfront,
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  Speaker 3: which obviously I've got quite a bit of experience from
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  Speaker 3: our past which I'm hopefully bringing to the business, and
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  Speaker 3: we've got some great leaders in there that I've also
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  Speaker 3: got some good experience that are new and fresh blood.
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  Speaker 2: Okay, so what are the problems that you see you
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  Speaker 2: look at Iran, what do you see.
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  Speaker 3: Actually, Iran is obviously you've got these flow on effects
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  Speaker 3: across the world, and I think you know a lot
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  Speaker 3: of uncertainty that's flowing into supply chains. I think that's
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  Speaker 3: the real real challenge. And obviously oil is the big, uh,
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  Speaker 3: you know, the big topic at the moment, because if
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  Speaker 3: you don't move oil and oils that's hard pricess and
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  Speaker 3: or not only just where the the prass of oil,
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  Speaker 3: but the access to oil is really the real challenge.
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  Speaker 3: And also you know, with the supply chaines with boats
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  Speaker 3: and you know, there's a lot of blank sailings and
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  Speaker 3: contention for both. So just the reliability of us of
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  Speaker 3: things hitting our shores at the right time there's also
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  Speaker 3: one fact. And then obviously the flow on of prafts
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  Speaker 3: is another thing that we're very conscious of.
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  Speaker 2: Yeah, I mean, look that that that is probably one
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  Speaker 2: of the most important fallouts is that we're likely to
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  Speaker 2: have another cost to living crisis as a result of
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  Speaker 2: this in some some way. Can you guys weather that.
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  Speaker 3: Yeah, I mean it's where a value resale and the
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  Speaker 3: mission doesn't change, you know, depending on the on the
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  Speaker 3: on the circumstances. You know, we deal with foreign exchange
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  Speaker 3: challenges and various different commodity challenges all the time. Obviously,
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  Speaker 3: this scale feels big, and we've got contingency plans and
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  Speaker 3: things that we use internally and we've started to look
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  Speaker 3: at scenarios on our own business, which any good business
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  Speaker 3: around New Zealand is doing our presumers this time, and
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  Speaker 3: we're working with all our stakeholders to mitigate as much
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  Speaker 3: of this flow on effect as we can. But you know,
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  Speaker 3: we believe, you know, value retailer and tough times should
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  Speaker 3: do well, and you know we well positioned as a
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  Speaker 3: value retailer to do that pertecularly about as our assortcements
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  Speaker 3: get better.
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  Speaker 2: Mike listen, thank you very much, really appreciate your time.
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  Speaker 2: That's Mark Sturtin, the chief executive of the Warehouse.
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