Shedden Light on OZ Design’s 40 years
Leading furniture and homewares retailer, OZ Design Furniture, celebrates its 40th birthday this year. Considering this significant milestone, OZ Design reflect on their beginnings and hurdles along the way.
Founded in 1979, by John Lock under the name of The Great Australian Design Company, the company originally sold imported household goods and Australian-made furniture. The first franchisee in the early 1980’s was a barely 30-year-old, Warwick Shedden, who was John’s next door neighbour and long-time admirer of John’s Porsche!
Along with his brother Neil Shedden, who acted as a financier, the brothers made an offer to buy a handful of stores from John, including the first stores in Auburn and St Leonards in Sydney. To better reflect what was being sold, the brothers renamed the business OZ Design Furniture.
From the mid 1980’s to Warwick’s untimely death in 2001, the business had grown to a franchise network of some 25 stores. Warwick was a pioneer in the Bulky Goods arena and along with Ian Robinson (Beacon Lighting) and Roger Wilson (Forty Winks), established the Bulky Goods Retailers Association, which is now known as the Large Format Retail Association (LFRA). To this day Warwick is honoured each year by the LFRA by the awarding of a Memorial Trophy in his name.
In the 1990’s Warwick and Northland franchisee Bruno Basile were on a select committee to assist the Government in establishing the new Franchise Code of Conduct. Franchising in Australia, up to that point in time was largely unregulated, so what followed was a Code of Conduct incorporated into Australian Consumer Law legislation to create fairness, transparency and appropriate penalties for unscrupulous franchisors.
In 1995 Bruno and Lynn Basile were voted Australian Franchisee of the year by the Franchise Council of Australia. Only this year have Bruno and Lynn retired, after spending 30 years as OZ Design Furniture franchisees, with their store remaining in the same location over all that time. Watch this space as the store undergoes a complete refit in February 2020 along with our Melbourne franchise store in Nunawading.
Warwick, as the Managing Director, grew both the size and reputation of the business, and developed strong relationships with a number of key Australian furniture manufacturers – in both timber and metal products, as well as sofas. The nice part of this story is that two of these manufacturers still supply OZ Design stores today, 40 years on.
After Warwick’s death, his brother Neil took on the role of Managing Director. Together with OZ Design’s long-serving management team, Patricia Osborne and Paula Cincotta, they continued to grow the business with newly appointed CFO Michael Petricevic and two of Neil’s eldest four children and son-in-law.
“I still remember the morning after Warwick’s death, meeting all the staff in the board room. Everyone was stunned – lots of crying and wondering what was going to happen. Would the business be sold? Who would be able to take on the role of MD? We had big shoes to fill.”
Neil’s daughter Bree Taaffe also joined the business a day before Warwick’s passing. Bree was initially involved in buying and marketing before venturing into other business pursuits and starting a family. She has since returned in recent years and works in the Marketing department and sits on the Board of Directors.
Neil’s eldest son Mark Shedden also joined around the same time as Bree, spending valuable time learning about many facets of the business including accounts, customer service and retail operations. Today Mark works in the Importing business which he helped set up in 2004 with his long time school friend and Bree’s husband, Richard Taaffe, who had a background in warehousing and logistics.
In 2009 younger brothers Scott and David joined the business and after working their way through the ranks, just as their older siblings did, now hold key roles as General Manager of the companies’ vertical importing arm and head OZ Design sofa buyer respectively.
Neil Shedden and Michael Petricevic decided to set up a Board in 2002 of which the late William Kirkby-Jones was the Chairman until 2012. All four siblings as well as Richard now sit on the Board of Directors, along with Trish Osborne, Product Director for 25 years, and Paula Cincotta, Marketing and Brand Associate Director for 26 years. All Directors work in the business on a day-to-day basis to ensure the business’ vision remains in trusted hands. That’s over 140 years of OZ Design experience amongst the 8 Board members, an average of nearly 18 years per Board member. This excludes its Non-Executive Chairman Neil Shedden who has been on the journey for nearly the entire 40 years.
“In 1979 when the company was formed, computers were only really used by large businesses, trading on Sunday was mostly illegal, there was little to no importing from Asia, consumers were offered very little in choice and the relative cost of goods in today’s terms was very high. 40 years on and here we are today – over 70% of our product is imported however we are still Australian owned and still manufacturing Australian made products,” explains Mr Petricevic.
Until the establishment of its Import business in 2004, the ability to compete was becoming more and more difficult as the business was reliant on other local wholesalers while its competitors were becoming nearly fully integrated. At the time of the 2008 Global Financial Crisis the business saw sharp declines in sales. Coupled with drought in some of its regional locations the business began to close a few franchise stores.
Accordingly OZ Design made the decision to substitute a portion of its parallel importers with its own Import business to stop leakage of gross margin (the importing arm now supplies 70% of the groups product, whereas in 2008 it was only 30%, not enough to sustain borderline stores).
Over the years OZ Design learnt the importance of reinvesting monies into the following;
- Appropriate technology across retail, importing, wholesale and logistics
- Opening 14 company stores in the last 3-4 years to support the import distribution strategy
- Completely changing the look and feel of the stores by renovating each and every legacy store
- Buying out franchisees that retired and or wanted to cash-in. Of the now 34 stores only 6 are franchised, thereby retaining control of the overall business. The business is now very happy with this corporate/franchise model ratio as it ensures the franchise stores keep their fit-outs and operating standards to the same standard as the corporate stores and within latest brand guidelines. This is essential for a fashion-based business whereby our customers come to us looking for inspiring invested looking showrooms
- Going from a franchise model to a largely company store model. It’s also good to have franchisees come along for the journey as it helps us benchmark our company stores against someone with “skin the game”.
There are no plans to phase out franchisees. Rather, “There are regional areas where franchising is a better option than company-owned stores,” explains Michael.
“Regional areas can receive the full benefits of the brand while applying local knowledge and tailoring the product to suit their demographic.”
After securing most of the supply chain to protect the business and experiencing the lows of outsourcing warehousing and logistics and leasing poorly designed warehouses, the business finally built its own warehouse and distribution facility on 6 hectares of land owned by Neil Shedden and his wife Darcy at Rouse Hill.
And so in October 2015 the business took occupation of its brand new warehouse and distribution facility, with 13 level loading docks, laser level floors, 12.2 m high racking and aisles only 1.85 m wide to allow wire guidance machines pick from up to 7,000 bays of furniture. The building of stage 2 of this warehouse is now underway, which will see the floor space expanded to over 21 000m2 over two levels. The economies of scale enjoyed by the new facility has enabled the business to branch into e-commerce with great success about 3 years ago.
There are now 34 physical stores across the Eastern Seaboard and Adelaide as well.
To this end, there is a very strong focus on customer experience at all touch points of the brand. Paula Cincotta has the task of ensuring the brand is consistent across all mediums, to allow customers the opportunity to engage at every possibility.
“More than ever brand consistency is the key to delivering a first class experience for our customers. It is an expectation with retail that what we inspire with today, we can deliver on tomorrow (if not today!) Consistency across all of our touch points is crucial to excite consumers, draw them in, keep them engaged and convert them to a loyal customer for life,” shares Ms Cincotta.
Visual merchandising within the showrooms is one area where OZ Design excels. This team, led by Anna Wojnarowska spend 100% of their time in-store, ensuring that product is chosen and presented in a way that grasps the customer’s attention through the use of style groups and visual trends. Anna explains,
“We have taken our showrooms from simply displaying furniture and product ranges to creating and inspiring, distinctive living spaces that meet and exceed our customer’s expectations.
“Our passion for furniture means we not only want to present a wide range of furniture styles, but also create a multilayered store environment where function, individuality and inspiration are equally important. We want to cater for people in different life stages and many different tastes by showcasing interior concepts in many different styles, but always individual and on trend.
“It is the store where the physical touch and feel part of buying process happens and we are constantly committed to improving our customer’s experience. Store upgrades, new store elements and new ways of store and product presentation are always our focus.”
Social media has played an increasingly significant part of business growth over the past five years. When used wisely, visual brands, particularly in the lifestyle and fashion, can benefit from the high reach of these mediums.
With over 210,000 followers on Facebook and Instagram, the OZ Design team spend considerable effort producing content that is both visually attractive as well as informative, with the opportunity for customers to click onto the images and be taken directly to the link to purchase.
Marketing Manager Iarni Harvey expands,
“Social media has had a large impact on our business and undoubtedly helped increase our brand awareness. It has been a powerful tool in our communications strategy to listen to, engage with and gain access to customers that we would otherwise not be able to connect and interact with.
“It has given us the opportunity for ‘instant communication’ with our audience and most importantly visually inspire and empower consumers to create dream spaces in their homes with our extensive collection of products through interior trends in furniture and homewares, materials and styles.
“Social media also allows our customers to interact with our platforms on a personal level based on their own style, needs and wants and ultimately our objective is to take them down a journey with our brand, to tell a story, inspire, to visit one of our stores or spend some time on our website with the ultimate goal of conversion in-store and online.
“Being a visual brand our photography allows us to set the tone for the brand and communicate key interior trends with our collections to our audiences. This year in particular we have focused on video content which now forms an integral part of our marketing mix.”
Our social media strategy forms an important part of our overall digital marketing strategy. With consumers spending more time on devices and technology at the forefront our team are working consistently to ensure a seamless digital experience in our communications across all touch-points from website, customer relationship management, e-catalogues, reviews, blogs and our paid digital marketing activity.
It has been a very exciting time for our marketing team to be involved in the evolution of digital marketing strategy and the way in which we engage with our customers and seek new customer to have a long term brand affiliation with OZ Design.
Going forward, OZ Design is moving in leaps and bounds, with a focus on exceptional customer service, bringing on-trend, quality furniture and homewares to market in a timely fashion and remaining relevant to our customer base.
OZ Design Furniture is a wholly Australian company, begun by an Australian with a vision for a successful furniture company for our own, local market…and now both owned and run by an Australian family and management team with the same vision. It has done this successfully for 40 years!
Michael Petricevic, Managing Director,
OZ Design Furniture
