Taking on giant supermarket chains such as Woolworths and Coles may seem daunting for a family business.
Yet Cathy Harris has relished the challenge for the past four decades – and her enterprise continues to thrive and grow. Cathy is the co-founder of Harris Farm Markets, the business brainchild she conceived with her husband, David. Launched in 1971, the business is a dominant force in the New South Wales fresh fruit, vegetables and produce sector and faces off daily against the big supermarkets.
From its origin as a single shop in Villawood, it now serves 22 communities throughout the state and employs more than 1000 people. Three of Cathy and David’s five children, Tristan, Luke and Angus, also take a hands-on role in the business.
Whether it has been running her own business or even being appointed as the country’s first women’s equal opportunity officer czar, Cathy has done it all.
“Being entrepreneurial was in our family,” she reveals. “I grew up with my mum and dad folding things called puggarees [cloth bands], which were used to put around hats for dad’s business. My mum, Mary Rossi, started her own travel company and it was the same for David, you know; he worked in his father’s business. So it was expected that you went into your own business.”
Early in her career, Cathy was constantly switching between entrepreneurial activities.
“We started Harris Farm together, then I’d go out because I had too many babies at the time and I’d start another business and then I’d come back in and then I’d go out and start another business, so I actually started about three different businesses,” she recalls.
Case proven – she is a serial entrepreneur. So let us deconstruct Cathy Harris to understand her key drivers. Asked if she started a business because she did not like being bossed around by others, Cathy is quick to say ‘no’.
“I actually did work for somebody,” she explains. “You know, I’ve worked for three amazing men – Laurie Brereton, John Niland and Peter Reith. They’re the only people I have ever worked for – pretty powerful men. Brereton and Reith were both the minister in charge of workplace relations, or whatever guise it was called, so when I was Federal Director of Affirmative Action I reported to them. And when I worked for the University of New South Wales, I reported to John Niland, who was then Vice-Chancellor.”
However, there is no doubt that Cathy and David’s biggest business achievement is the creation of Harris Farm Markets. So did the enterprise come out of a clear plan?
“Definitely not, even though both David and I had done commerce at university. I don’t think business plans were fashionable as they are now, though I wish they [had been],” she laments.
“When we first started our plan, if you could call it that, it was that we would go in, we’d take over a business, we’d build it up, we’d work our guts out – probably for three to seven years – then we’d sell that business and we’d have three months off, then we’d buy another one. You know the sad thing was that we never did sell any. We just built on and built on and built on and we never got that three months off.”
The response raises a key question: why did the Harrises become keepers rather than sellers?
“We became keepers because we thought we were pretty good at it,” Cathy says. “We thought, ‘gosh, this is pretty good. It’s a good space to be in’. It felt good. And we could see it really expanding and going well … We were doing it pretty well and there wasn’t anybody else in the space. Coles and Woolworths hadn’t even thought about fresh [produce].”
Through experience, Cathy and David have come to appreciate that the fruit and vegetable market is one in which your trading ability is crucial to the bottom line.
“I think one of the reasons we’ve succeeded more than some of the bigger Coles and Woolworths operations is because of that trader instinct – that’s where David’s genius is. He’s the trader and I am the one comfortable and used to corporate governance issues, which gives us a pretty good balance.”
Cathy says over time they realised David’s strength was working in the business while for her it was working on the business.
“It’s hard for entrepreneurs because they think doing anything that is not adding profit to the bottom line doesn’t have any value. It’s all about staying alive to the next month, to the end of the year – they’re not thinking 10 years out.”
While this experience at the coalface has been important to the success of the business, university education has also played a crucial part in the Harris Farm Markets story.
“It taught us what we didn’t know and it taught us the value of getting people in that do know,” Cathy insists. “I think in my case it really helped with [skills development] – you know where to look, where to get help and to realise that you have to broaden your horizons. It also gave us confidence.”
Did it result in a competitive advantage for the business?
“Exactly,” Cathy says. “For example, we adopted computerisation well ahead of even the big retailers such as Woolworths and Coles and we had much more sophisticated systems. We travelled in those early days and we saw in America how you could put apples on the scales and it would go straight to the cash register – we actually brought that technology into Australia from America and we had to have legislation changed to use it. This willingness to innovate came out of our university education.”
Over the years, Cathy has learnt many business lessons.
“It’s not all about sales, it’s about margin and sales,” she advises. “And you have to know the importance of developing people, developing loyalty and the importance of protecting your brand.”
Harris Farm Markets, Cathy argues, has brand loyalty but it has not come through marketing, which the business is looking at more intensely now.
“This is going to sound like rubbish, but I really think it was more because we delivered the product that we got brand loyalty,” she says. “We focused on quality and at a good price, so it was real value and I think that’s how we got brand loyalty – not through any advertising of our brand but because we’ve been around since 1971.”
Another important lesson Cathy has learnt is knowing what she is not good at and looking for people with expertise to fill the gap.
“We’ve been really happy to employ or bring into the business people who do have those skills,” she says. “However, what we have learnt over time is to bring them in as consultants as opposed to employees. You can get a highly skilled consultant who can work their butt out and really put a lot into it for three months and, really, once they’ve done that, you can adopt what they’ve taught you. On the other hand, to get the really bright people in you have to pay them a lot of money.”
Business has not always been easy for the Harrises. In the 1980s, its key equity partner, Panfida Foods, went bankrupt – putting a real squeeze on funding that threatened to kill off the business. Drawing on support from family and friends, they rebuilt an even stronger operation. Cathy reflects on the need to work with partners or funders.
“We’ve grown so much and we used partners to regrow after we had a near-death experience and they were wonderful partners. And we’re eternally grateful for their help, but all our growth from there onwards has been internal growth so we’ve used the success of the business to grow the business.”
Now in her 60s, Cathy has no doubt she has changed considerably as an entrepreneur and says working outside the business has helped.
“When we had our near-death experience we both couldn’t afford to work in a business so I went and got a job and I couldn’t believe how naive I was, but I had other skills, entrepreneurial skills that I brought to the job.”
First she worked at UNSW in the early 1990s as Head of Alumni. Later, she went to the federal public service before eventually returning to the business.
Asked what has been critical to the success of Harris Farm Markets – the business model, the marketing, or the customer service? – Cathy is firm. It is the product.
“The product was the hero without doubt,” she maintains. “Oh, maybe it was two things – the product and David Harris, the trader. He knew that if he put particular mushrooms on at Edgecliff, the people would pour in the door, but he couldn’t put those same things on at Villawood. He’d have to put artichokes on it, and it was his knowledge and him being the real trader that did that.”
When it comes to advice for up and comers, Cathy remarks that while she and her husband have not always got it right, planning is essential.
“I think if we were doing it all over again we’d have much better plans and we would have a much better feeling for the numbers. We’re really good at that now. We’ve got one of our sons who has a Masters degree in finance and he’s got this other chap working with him and they just spin the magic with the numbers. I think it’s crucial and if you keep an eye on the margins then you know what’s successful and what’s not successful and where it’s going. That’s terribly important and I don’t think we did that well at the beginning.”
Do not neglect the brand either, she advises, and make sure it can grow with you. But wait, there’s more …
“The other thing I think is really important is that you identify what you value and this is part of the self-knowledge stuff. If you really identify what you value in your business, then it sort of guides you when you have difficulty making a decision. You need to articulate and have clear values, but they don’t have to be all soppy.”
The values of hard work and respect for the customer underpin the Cathy and David Harris story and explain why they have created an enduring Australian brand. With their sons playing an increasingly pivotal role, it is a story that promises to have more enticing chapters.
This article was originally published in Savvy – Understanding the Entrepreneur. In Savvy – Understanding the Entrepreneur, we have put some of our finest tertiary-educated entrepreneurs, who also happen to be graduates of the Australian School of Business at the University of New South Wales, under the success detection spotlight.
Savvy – Understanding the Entrepreneur explores the minds of our best business achievers who reveal what they’ve done to build a great company.
To order copies of this book, please visit: http://shop.switzer.com.au