RAGTRADER: Melbourne Special
Ragtrader asked its readers to nominate four influential ragtraders for a profle in this special edition. Erin O’Loughlin kicks things off with PAS Group CEO Eric Morris.
He has worked in South Africa, China and Australia for the likes of Reebok and Myer, but it is as CEO of the PAS Group that Eric Morris has settled in a city he describes as obsessed with fashion festivals, racing carnivals and comedy galas.
“I’ve lived in a few different places myself and been exposed to various markets around the world but I’ve never seen a city which embraces its events like Melbourne does,” Morris says.
The South African native was lured to the group in 2005, just months after it was formed by a Deutsche Bank private equity fund to undertake a ‘roll up’ of Australia’s fragmented apparel sector.
“They had just bought the [wholesale] Breakaway business when I joined,” Morris says. “They had been searching for a CEO for some time. Then together with my CFO Derrick Krowitz, we put the strategy together for the group and went out thereafter and started acquiring businesses.”
The challenge of finding talent to fill his Mount Waverley head office is something Morris describes as “one of the biggest challenges” he has found in the Australian apparel market. PAS, which has 25 retail and wholesale brands including Metalicus, Yarra Trail, Sirocco, Review and Chino Kids, currently has 800 staff in its ranks.
“There really is a lack within the Australian market and we have struggled,” he says. “Hence we’ve actually got a couple of people who’ve joined the business from offshore. We’ve tried wherever possible to support Australia but there are times where we’ve looked wide and can’t find the right person.”
It’s a problem he is endeavouring to fix. Morris has just overseen the rollout of a talent program within the company, with nine employees in the first phase of a six-month course. The program is also one of Morris’ strategies to ensure PAS remains buoyant within the current “challenging” market.
“One needs to make sure your internal processes are really good and tight, as well as you have the right people in the right roles and you have sufficient growth programs for them, training programs, development and so on. That’s really key for us.”
Among the factors Morris has observed as being central to 2011’s market conditions are changes instituted by key trading partners.
“I think particularly the majors – I’m talking about the department stores and discount department stores — they’ve both tightened up on their trading terms. There’s a lot more onus on the supplier, the wholesaler, in terms of performance.”
But while trade may be tight, it’s not stopping Morris from forging ahead with PAS Group’s “integration and growth” phase. The company has been steadily rolling out retail doors for young womenswear brand Review over the last four years, bumping it up from 22 to 65 stores. PAS is currently on the hunt for a licensee to operate retail stores for Metalicus in Asia and the Middle East, and the company also wants to boost the wholesale and retail presence of its Breakaway and Yarra Trail brands, which target an older consumer.
Morris believes that in a normal trading cycle, retail operations are smoother to run than wholesale.
“It’s probably a little easier because you get direct feedback,” he explains. “For example, if we’ve got our own store we can run our own loyalty programs which enable you to communicate directly with the consumer, but also you just speak to the store staff and they tell you exactly what the consumer is wanting. When you’re selling through a third party, you’ve got to speak to somebody else who’s selling multiple brands, who’s less focused.”
Direct feedback is also Morris’ antidote to a plague he has observed within many a head office.
“Having worked for private companies, public companies, international companies, global companies… there’s one thing that I’ve found all the way along the line to be quite often missing in these scenarios, which is trying to run a business on a common sense basis. You’d probably say, ‘surely all business is run on a common sense basis?’ and I can honestly tell you some major organisations aren’t. There’s too many things which sit in the way. I challenge everyone in our organisation to either call me or send me an email and tell me a decision that doesn’t make sense and we’re very happy to listen.”
It’s a no-nonsense approach derived from his 30-plus years in the apparel and footwear sector, as well as perhaps from his grandfather and father, ragtraders in their own right.
“I kind of grew up with it,” Morris concedes. “It’s been in the blood.”