No wonder traditional stores are going broke

Posted on February 21st, 2014 in Opinion by Julian Edgar

Here in Australia, the fading gasps of the traditional department stores are mixed with the outraged squeals of shops – often selling electronic goods – that were themselves once the young and daring of the retail scene. They’re the ones now old hat, made irrelevant to many consumers by the Web.

I am happy to see retail Darwinism rampantly at work: if I can buy books from overseas, the transaction conducted online, for about half of what I’d pay in Australia, then I’ll do just that. I am a trifle sad to see the disappearance of specialist local bookshops – say, motoring bookshops – but I am not so regretful that I want to pay hundreds of additional dollars out of my own pocket each year to keep them going.

But some stores are, to me, a little different.

Dick Smith Electronics started back in 1968 by the man himself, Dick.

I was five at the time so I don’t remember much about it but I do remember that by the time I was about 12, there was a Dick Smith Electronics shop close to where I lived. It sold wire, CB radios, aerials, connectors, transistors, resistors, capacitors and other electronic components. For those who liked fiddling in this area, it was better than heaven. In fact, back then, there was almost no other way of buying non-industrial quantities of electronics components.

Sixty percent of the company was sold to Woolworths in 1980, and in 1982 Woolworths took full ownership.

From that time until the present day, Dick Smith Electronics has moved more and more away from hobbyist electronics and towards commercial consumer electronics – TVs, music systems, and so on.

So for me, the incentive to walk into a Dick Smith Electronics store has gradually withered away. I buy nearly all my electronic goods online, but even as I do so, I am conscious of a tiny nagging regret that I taking my custom away from a store (now actually owned by private equity firm Anchorage Capital Partners) that served me well in my youth.

So – to today’s events.

I wanted a watch – a smart watch that would talk to my phone. I looked around online and found what I wanted. It would cost me around $160 plus postage – or, I found to my surprise, $179 at Dick Smith Electronics.

So while it would cost me a little more at Dick’s, the fact that I’d be able to try the watch on my wrist and actually look at the thing in the flesh was sufficiently persuasive to offset the additional cost.

Into the store I went – and they had one in stock. But would they let me look at it?


Would they even open the box so I could try it on my wrist?



If that’s the service, what are the actual consumer advantages of buying in a retail store?

As soon as I got home, I bought the watch online for $150 plus $10 postage…

I can’t see myself ever going back into a Dick Smith store – and that’s from someone who actually has more loyalty to the chain than the vast majority of people.

No wonder these darn stores are going broke….

Not building cars here is good for all of us

Posted on February 13th, 2014 in Driving Emotion,Opinion by Julian Edgar

So now no cars are going to be built in Australia.

Rather deafening in its quietness among the population at large, and car enthusiasts, is the simple question: does it actually matter?

Obviously, for those individuals who lose their jobs, yes it matters. But that’s the case equally for anyone who loses their job – how does being in a role associated with car building in Australia make those jobs special cases?

So does it matter for those who love cars – car enthusiasts? Perhaps – at least for that minority of enthusiasts who like buying the (mostly) large and powerful cars that have been made in Australia. For the vast majority who over the last decade have never bought a new Australian-made car, and who never would, it’s hard to see that it matters very much at all.

And what about for the country?

Who thinks the future of the Australian economy is predicated around manufacturing? To believe that, you’d have to be blind to the employment patterns over the last 50 years. As a proportion of total employment, manufacturing in all western countries has fallen steadily over that time. The idea that all countries must make things, and that a service-based economy is intrinsically weak, is rather out of keeping with easily demonstrable statistics re individual country wealth, standard of living and so on. To take just one example, look at the export income earned in Australia through servicing overseas tertiary students – it’s massive.

And what of the loss to the country of a skills base? Well, which skills are we talking about?

To suggest that those working on production lines are highly skilled is patently ridiculous: to those who say they are, what is these employees’ formal trade? Their tertiary qualifications? The entrance criteria for such a position? The years of training required before they can perform the role?

But what of those people working in the industry that in fact do have high skill levels – say, the production engineers and the automotive design staff? It’s hard to believe that these people will find it difficult to gain work elsewhere – they have marketable and transferable skills. Therefore, they will not be lost from the pool of available labour – and furthermore, engineers and technically skilled people will continue to be trained… car building industry or no car building industry.

And is it important that we are losing the capability to design and build complex items? That is, it is vital to Australia that we retain these high-level skills? Yes, perhaps – if in fact they were world-competitive, high level skills!

But are they?

If our car designing and building skills are (were) of such great magnitude, wouldn’t we be a world leader in car design? That’s obviously not the case, so to imply – as some are doing – that we will be fundamentally limited in the future if we aren’t designing and building cars here, simply doesn’t reflect reality.

Cutting edge automotive design and development doesn’t exist in Australia – instead, we’ve got the technologies that the overseas parent companies have chosen to begrudgingly dole out.

(Don’t believe me? Well, name an automotive technology invented and developed in Australia that has subsequently been adopted widely. I can think of only one – Orbital stratified fuel injection.)

In fact, the opportunities that are now available make the end of car building in Australia a good news story. Now, finally, state and federal governments are released from the previously politically impossible action of moving massive subsidies for car production to industries that can actually flourish over the medium and long term. Those are the industries where Australia has a competitive advantage – one that’s due to its relatively educated, literate and numerate workforce, all positioned near Asia.

What an extraordinary opportunity to invest in start-up (and existing) companies performing R&D on renewables and medical technologies; to invest in knowledge-based exports like tertiary education and high level IT services; to upskill the workforce through training and further education.

Closing of car manufacturing in Australia has released us from an albatross around our necks: now we need leaders with enough gumption to take advantage of the opportunity that the massive amount of freed resources can give us.

But will I look nostalgically in 15 years’ time at a mint condition Falcon XR6 Turbo parked by the side of the road? Yes, I sure will. But that’s no reason to keep subsidising car manufacturing at the expense of other employment and growth opportunities far better suited to Australia in this century.


The lamb from heaven

Posted on February 2nd, 2014 in Driving Emotion by Julian Edgar

A warning: this has nothing to do with cars….

As some of you will know, I live on the edge of a tiny hamlet in country New South Wales, about 80km north of Canberra. It’s a pretty relaxed place that I like a great deal. Most people in the town with young children have one or two acres, and pet sheep are common. In fact, off hand, I can think of five families that each own a pet sheep. Good for keeping down the grass and, if reared from a lamb, sheep are surprisingly sociable and interactive animals.

Our sheep – Victor – came to us in a cardboard carton, a tiny, weak little lamb that had been abandoned by his mother.

Victor was fed milk replacement, and sheep pellets, and then lucerne, and then grass from the yard, and subsequently grew and grew. He was initially free to roam our block, but then he started to butt house windows and eat flowers and be a pest. So he’s now constrained to about 250 square metres – plenty of space for him… but not enough for another sheep.

So when another lamb arrived, it was never going to be kept. But boy, was I ever tempted! Why? Because I think it might be one of the luckiest lambs alive….

It was a Sunday afternoon, and my son, Alexander (aged 9) was playing in the yard. The front gate was shut, and he was using a rope to pull a skateboard up and down the dirt driveway. He’d run up the driveway, towing the skateboard behind him, complete with an action figure taped to it. The skateboard would leap and jump behind him, until he reached the end of the driveway, bent to make some adjustments, and then pulled it in the other direction, heading back towards the road.

And then, as suddenly as it sounds, a tiny lamb appeared just inside the gate, wandering about forlornly.

The gate was shut; no car had appeared; and there are no flocks of sheep within 2 kilometres that currently have lambs so young. The time window in which it must have appeared, what with Alexander running back and forth, would have been 10 seconds maximum.

The lamb – it just literally appeared.

Alexander ran to the house and said, “There’s a lamb in our yard!” 

My wife Georgina caught the lamb (easy: it was quite weak and slow), and fed it some water and then milk.

But where on earth had it come from?

The lamb had a few injuries. Its nose and mouth were a little bloodied, but the most interesting injuries were on its back. There, still freshly bleeding, were four small cuts, each perhaps 10mm long. They were spaced in two parallel pairs, on the very upper surface of the lamb’s back.

A few days earlier, circling on the thermals they ride, Georgina had seen a pair of wedgetail eagles. These are very large birds, strong enough to pick up rabbits and carry them away.

And perhaps strong enough to carry a lamb…

Anecdotally, many people suggest that wedgetail eagles can scoop up live lambs, but an authoritative reference I have on these eagles says that this is in fact a fallacy – that lambs are carried by wedgetail eagles only when they are dead, and so not struggling or running prior to being caught.

But we can think of no other explanation that would account for the lamb’s incredible sudden appearance from thin air, and its pattern of injuries. Furthermore, Alexander found four little depressions in the bark chips close to where he first saw the lamb, spaced to match the lamb’s hooves.

Had a wedgetail eagle grabbed the lamb, carried it a minimum of several kilometres, then settled on the bark chips in our yard to eat it – only to be disturbed by Alexander running with the skateboard? If so, that tiny lamb had just had the ride of its life….

But despite its cuteness, and its extraordinary mode of arrival, we couldn’t keep it – and after making half a dozen phone calls, Georgina found someone in our town who wanted a new pet lawnmower.

Gosh, if only I’d looked at the window a few moments earlier and seen the lamb arrive, carried by an eagle. That would have been something to remember forever…