Competitive team player

A conversation with Fred Harrison

Fred Harrison, Director and CEO, Ritchies Stores Pty Ltd, considered careers as diverse as professional tennis player and politician, but Ritchies had an eye on him from a young age.

"In my early teens, I grew fruit and vegetables on our block in Mt Eliza, and sold them to the original Ritchies store in Thompson Street, Frankston, for pocket money" recalled Fred. "In those days, Ritchies comprised four or five stores on the Mornington Peninsula. The Frankston store manager used to say to me, 'Come and work with us when you are older', but I was not planning to at that stage."

Fred describes himself as an above-average but not brilliant student, who preferred English Literature to Mathematics. "On reflection, English has proved very useful in my job, which is all about communication," he said. "But, at that time, my passion was tennis.

"I started playing tennis when we moved to Yallourn in 1967. My father was a teacher and he was posted to Yallourn Technical School. It was a government town with fantastic sporting facilities. My strength was in doubles (and running fast wasn't my biggest strength). I think because, even though I am fiercely competitive, I am also a team player. Our team won a few interschool pennants and we had good success in many of the weekend competitions we played in and tournaments around Victoria.

"I continued playing competitive tennis when we moved to Mt Eliza in 1970, and played through my high school years and at university. At one stage, a group of us registered our own four-person tennis club called 'Independence'. The four of us just wanted to play together, but the other clubs kept splitting us up. When we competed as part of our own club we won a pennant flag, even though we had no formal venue. The other clubs complained that we did not have a written constitution, so we created one that said, 'We constitute that we will do what we want', so I guess I have a rebellious, independent streak in me too. I was never going to work for Coles or Woolworths. I prefer a less formal structure. I believe we are a bit more flexible and make decisions quicker, and we have more fun.

"I started studying economics and politics at Monash University, but realised early on that I did not want to be an economist. I also realised that I would not be a professional tennis player. Later on I considered politics, but at that time I was just looking for a job.

"I was working at the Ritchies Frankston store during the holidays – I had been a casual there since high school, when my first job was as a baler. We did not have crushers in those days. I ripped the cardboard boxes up by hand and put them in a hessian bag and jumped up and down on the contents. While I was working there in the university holidays, the position of assistant manager became vacant. I did not really want to back to university, so I applied and won the job. After 18 months I was given the chance to manage stores as a relief manager, including eight weeks at the Hastings store when the manager was on long service leave. Then, at the age of 20, I was placed as manager in the flagship Bayside Shopping Centre store – the youngest manager in Ritchies at that time. Two years later I was appointed supermarket supervisor and also given the task of helping set up new stores and refurbish existing stores.

"I think I progressed quickly because I enjoyed competing with the other stores. I wanted to have the top sales and make the store look as good as it could. That meant finding the best staff. I also liked the discipline and standards expected in managing stores.

"My parents were strong on discipline and following the rules. My father's father fought at Gallipoli and was very strict with him. Being a teacher, my dad was strict too. That being said, both mum and dad were supportive and good role models. We are lucky to still have both of them in our lives.

"The combination of being a team player as well as very competitive seems to come out in most everything I do. One of the best things I have ever done for myself was joining the public speaking club, Rostrum. Barry Cameron, then the owner of Ritchies, told me, 'If you want to be a senior executive you have got to be able to get up in front of people and speak well'. I joined Rostrum when I was 22 – much younger than the others there – and I learned a lot. I became good at the 'impromptu', where you had to stand up and speak for 10 minutes on a given topic without notice. There was method in this madness. The prepared speeches took up a lot of time at home on the weekends and I was dating Denise, who later became my wife.

"Denise and I were childhood friends. We built our first home in Frankston. Other than the couple of years at Yallourn, I have only lived in one area; I have only had one wife and one job; and I only drive Holden cars.

"Rostrum was my education and a good one; the best training for my role with Ritchies, where I need to think quickly and communicate with people. I was with the club for about five years, including serving as President. I like to get involved and lead when I can.

"In 1984, at the age of 27, I was appointed General Manager of Ritchies when Barry Cameron passed away and Peter Carson became CEO. Ten years later, Peter departed and I was given the opportunity of leading the company and was ultimately appointed CEO."

In the 15 years that Fred has been at the helm, Ritchies has grown exponentially; from about 12 stores in 1994 to 58 stores, and from a turnover of approximately $55 million in 1994 to $800 million today, and the largest independent supermarket chain in Australia.

"Of course, the active pursuit of growth was a board decision," said Fred. "But, Mal who is our CFO and a fellow director, along with James Cameron our liquor general manager, were the guys who drove growth in the early years, because we realised that this business is all about volume. Volume matters to suppliers, and it reduces risk. Some stores make money; others lose. You need to try and have more good profitable stores than bad loss making stores. Mal and James Cameron, along with myself, were a formidable team! We enjoyed each others company and had plenty of fun, as well as working very hard. James left Ritchies in 2000 but has returned recently as a nonexecutive director.

"Even though we have grown, we are still an independent business. Metcash, management and staff have significant minority shares and no one person controls Ritchies; we are still a privately-owned family company. We are also still firmly established within our local communities. Even though we can't say that everybody knows everybody who works within Ritchies these days, we retain a culture of family values. This is reflected in our profit sharing with staff and our donations to the community."

When a Ritchies' Community Benefit Card is scanned at the checkout register, a donation of 1% of the money spent in the supermarkets and liquor stores is allocated to the charity chosen by customers. More than $32 million has been paid to clubs, schools and charities to date.

"The philosophy of Ritchies and our company ideals fit easily with my own personal ideals, and we attract like-minded people," said Fred. "Our employees are dedicated, disciplined and hard-working, and they like working for an independent business. Sixty percent of our costs are labour, so we rely on our people. We have many stars that get us over the line every year, and I am proud to be part of the team and their leader.

ADVICE TO MANAGERS

Be humble and don't lose sight of what made you a success – sometimes managers get carried away with their own importance, but it is essential to treat everybody with respect. My parents taught me that.

Don't lose your sense of humour – you need to stop and have a laugh every now and then, and sometimes at yourself. If you wallow in self-pity, you will not last in this business.

There are more ways than one to get a result. You might have a view of how to achieve a goal, but other people might have a just as good (or even better) idea. We have a saying at Ritchies: 'It does not matter who has the bright idea as long as one of us does'.

Consider the feelings of others. Even though you have to make quick decisions in business, it is important to take time with those decisions that impact others.