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ABSTRACT
The Warehouse has been a company synonymous with growth and success in New Zealand since Stephen Tindall founded the company in 1982. By 1999, The Warehouse had become the largest retailer in New Zealand and had continued to steam ahead since. In early 2001, incoming CEO Greg Muir faced a real challenge in transferring that success across the Tasman into Australia. In August 2000, The Warehouse had acquired the Clint's Crazy Bargains/Silly Solly's chain of 115 discount variety stores in Australia. Could The Warehouse implement their format in Australia and would it be as successful as in New Zealand?
INTRODUCTION
In November 2000, The Warehouse Group was named New Zealand's Company of the Year at the annual business awards organised by Deloitte's and Management magazine. The award came on the heels of The Warehouse's Annual Meeting where the company was able to announce sales in excess of a billion dollars for the first time. Profits too were soaring, up almost 30% on the previous year. Excellent results, however, were not new to Warehouse shareholders. Stephen Tindall, the founder of the company, had built The Warehouse into a phenomenal success, with an average return on equity of 37% and compound sales growth of 29% over the last decade. The 2000 annual meeting did more than reflect on an excellent year, however. The meeting also served to publicly signal the succession of Stephen Tindall as CEO by Greg Muir in January 2001.
The transition in CEO coincided with the transition of The Warehouse from a company focused solely on the New Zealand market to one focused on Australasia. On August 1 2000, The Warehouse took possession of their first Australian outlets. The company acquired a 115store Australian discount retail chain that operated as Glint's Crazy Bargains in New South Wales, ACT, and Victoria, and as Silly Solly's in Queensland. The Australian stores represented a major challenge for The Warehouse. They were less than a third of the size of the average Warehouse store in New Zealand and were supported by relatively immature logistics and IT. Stephen Tindall had described the Australian stores as being in a similar state to The Warehouse seven years ago (Management Magazine 2000, p. 28). Moreover, The Warehouse had no experience...