Another iconic Australian retailer has been sucked into the ever-growing vortex of collapsed businesses, courtesy of Australia’s cost of living crisis.
Godfreys, a brand name known in every Australian household, has shut up shop after nearly 100 years of trading. Established in 1931 by Mr. Godfrey Cohen, his business became synonymous with family business enterprise and entrepreneurship.
In an era when much of retailing was undertaken by the travelling door-to-door salesman, Godfrey took the gamble of buying some vacuum cleaners and trying his luck in selling them through the family furniture shop.
It was a gamble which, over the years, paid handsome dividends for the entrepreneur. Five years later, he established with a partner the first Godfreys store.
The business grew into an empire with approximately 225 stores across Australia and New Zealand, employing hundreds of staff.
Its founder passed at the age of 95 in 2004, some 70-plus years after its founding. A couple of years later, Godfreys was sold for $350 million (US$230 million).
An enterprise and employer based on customer service and competitive pricing, its place in the heart of Australians was developed over the years, not only through its numerous outlets and competitive pricing, but some innovative advertising.
This included the boss of Godfreys showing the strength of one of his vacuum cleaners picking up a 7 kilogram (15 pounds) bowling ball. Great sales pitch.
Unfortunately, the Godfreys branding suction is no longer as strong as it used to be, and the bowling ball of the cost of living crisis has ripped through its stores like it would through a set of tenpins.
Such a collapse hits not only employees and their families together with landlords who have lost long-term tenants, but also general confidence in the market for retailing.
More Than the Collapse of One Brand
Overall the Australian people, in witnessing the demise of another of their iconic Australian brands, will be shattered not only for reasons pertaining to patriotism, but their own economic security.Once the malaise sets in where people are genuinely fearful for their economic well-being, the downward spiralling whirlpool impacts every aspect of the economy.
In those unfortunate circumstances, prudence dictates repayment of debt and savings and thus the downward spiral accelerates taking with it even more victims.
And let’s keep in mind, that most Australians would consider a vacuum cleaner as an essential household item.
As our population is growing, and with it, the number of houses, the demand for this essential item should have been commensurately growing. Clearly, it has not.
One can only assume the demand did not dissipate but the capacity to purchase has, which one cannot help fearing is an indicator of consumer sentiment and capacity.
As an indicator, the collapse of Godfreys is sounding like a bellowing alarm as a harbinger of things to come.
Yes, the cost of living crisis is real with devastating consequences. Yet the government has spent the first half of its term pursuing the impractical ideological and ultimately overwhelmingly defeated The Voice referendum and other irrelevancies like funding an assistant minister for the republic.
Its recent cost of living crisis summit held in Canberra will not assist the government’s flagging credentials, as its answer to the crisis was to break a fundamental election promise, denying the government the moral authority needed to deal with crises.
A refusal to provide promised tax cuts will hurt people’s hip pocket and their confidence in the economy and their security.
When the government takes more tax, less is spent on retail, and definitely not on vacuum cleaners.
As the Godfreys appliances come to a halt, it appears the government remains steadfast in attempting to suck the Australian people into believing they are dealing with the ever-growing crisis.
The Australian people weigh a bit more than 7 kilograms and will not be sucked in irrespective of the government’s high revolutions spin doctoring.
The cost of living crisis is serious. Godfreys collapse puts that beyond doubt.
