Holding the role of General Manager Source to Shelf at Mitre 10 since 2008, Duncan McGhie has been serving on Retail NZ’s board of directors for nearly six years, and has been president for the past two years. He is stepping away as he moves to Chicago, USA, where he will take up a new role in August as vice president international merchandising, imports and proprietary brands with Ace Hardware.
McGhie is one of the many senior retailers who began on the shopfloor aged just 16. He was working part-time in the school holidays when L.D. Nathan offered him a career, and worked a three-year cadetship with the Woolworths owner before winding up running supermarkets at 21.
McGhie says the increasing pace of technology has formed the backbone of industry changes he’s witnessed across the years.
“I remember telexes, handwriting purchase orders, faxes… Mobiles, computers and data basically transformed retail into where we are today.”
With the transformation of technology, McGhie says, time is much tighter than it once was, and customers are now taking the lead.
“It was the days of the manufacturer, the days of the importer/wholesaler/retailer, and now it’s the days of the customer.”
Customers are more informed than they used to be, and purchasing behaviour has shifted. Whole families formerly went shopping once a month, but now, McGhie says, there’s a constant stream of at-home purchasing happening via ecommerce.
“In today’s world, the future of retail in New Zealand is bricks and mortar being the foundation, but digital is the channel. It’s as seamless and frictionless to the customer as possible.”
Shoppers commonly research products before purchasing them, and some 60 percent review product in their spare time: “They’re more informed than the retailer these days.”
The globalisation of retail means product can reach Kiwi customers from just about anywhere in the world within three days, McGhie says: “The globe used to be a big place.”
Rolling with the increased focus on customers is the way to survive as a retailer long-term, McGhie says: “Be relevant to your consumer. The customer is king.”
“If you have a passion for the customer and a focus on servicing them, you’ll win them.”
It’s difficult to compete with global giants like Asos on price, but price is just one attribute of retail, McGhie says – there’s also location, availability, and experience.
“Add value through the things you can control – go above and beyond.”
As an example of ways a retailer can add value, McGhie recounts a story from his time at Mitre 10. A shopper who was a solo mum wanted to buy a lawnmower, but couldn’t fit it into her car, so McGhie went out of his way to drop the item off at her place on his way to work the next day.
“A great shopper experience is something you aspire to, a poor shopper experience is something that’s given, and there’s no loyalty to you after that because the customer has choice.”
Community integration is key to remaining relevant to your customers, McGhie says: “Send your kids to local schools, be part of local clubs, donate to local causes.”
He says this is as true for retailers working for larger companies like Mitre 10 as it is for SMEs, explaining that “anyone you put into the community needs to have the soft skills to promote the company”. McGhie describes community integration as a great way to customise bricks and mortar retail outlets.
Although retail is one of New Zealand’s biggest industries, employing 10 percent of all working New Zealanders, the inaccurate perception that retail is a temporary gig rather than a career is still present in the market. McGhie likens retail to a trade – “because that’s how I started”.
McGhie says retailers should favour staff who have “desire, initiative and drive” over those who are highly educated: “Someone who engages with it in their gut, who really wants it.”
“All retailers, small or big, need quality people to work in retail.”
With constant pressure on the cost of doing business, McGhie says retailers find there’s a perception they are prosperous operators which can “afford to do everything”.
“We’re also told we’re too expensive.”
McGhie is proud of his work with Retail NZ in helping members create sustainable businesses for the future and “simplifying the complicated” for them.
“Retail NZ does represent all retailers both small and big, and every day the team is trying to add value.”
Among his most significant achievements are the years of work he and the team at Retail NZ put into working on the ‘de minimis’ tax loophole.
The existing tax system sees only items sold into New Zealand online for over $400 subject to GST, which is collected at the border. All goods sold online to Kiwis by foreign companies for less effectively are GST-free, giving overseas retailers a tax advantage against their New Zealand equivalents.
Legislation closing the loophole will take effect from 1 October this year.
McGhie says it was a complex topic on which to advocate for change, requiring both winning consumers’ hearts and minds, and convincing Government that change wasn’t “too difficult” after all.
“It was a dedicated team influencing change in consumers and Government,” McGhie says of Retail NZ’s lobbying around the de minimis. Other Retail NZ campaigns enacted under McGhie’s leadership have advocated banning plastic shopping bags and investigating the cost of payment systems.
McGhie’s more than 12 years with Mitre 10 included many big wins. He was brought on to help grow the Mitre 10 Mega brand, and now leaves it as the market leader for the home improvement category.
Chris Fisher, group merchandising manager, will be taking on McGhie’s former leadership position at Mitre 10. McGhie says he couldn’t think of a better person to take Mitre 10 on the next leg of the journey: “We’re on a journey and we’ve had a lot of fun and a few frustrations along the way, but it’s been a blast.”
Speaking of his new role in Chicago with Ace Hardware, McGhie says that while the size and scale of some product offerings will be different in the US, the base fundamentals and principles of retail will remain familiar.
“I’ve always been a person who likes to learn.”
This story originally appeared in NZ Retail issue 762 June/July 2019