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The Weekend Neos Kosmos : 25 October 2014
SATURDAY 25 OCTOBER 2014 25 BUSINESS FINANCIAL WEEK On the back of a report in The Australian which suggests approximately 67 per cent of worldwide businesses are family-owned, Neos Kosmos spoke to Nick Koukouvitakis, whose family owns furniture wholesaler LV Furniture, about how the business first came to fruition and how it continues to sustain itself in an ever-evolving global mar- ket. LV Furniture supplies large-scale corporations like Harvey Norman and Forty Winks, with its main office showroom in Melbourne, and smaller warehouses in Perth and distribution centres in Brisbane. Having migrated to Austral- ia in 1964, Nick's father Steli- os was approached by a fami- ly friend who was considering a move into the business sec- tor. It was that move that first got the Koukouvitakis family into furniture wholesaling. "My father started the busi- ness in 1977. He was in hos- pitality originally, or one of the many things he did as a first generation Greek, he went through quite a few jobs and professions. A fam- ily member of his was trying to set up a furniture manu- facturing business and dad helped him along the way and said to him 'look why don't we start this up togeth- er' - and that's how he start- ed. He wasn't in the trade, he wasn't a professional as such, he wasn't a cabinet maker or a furniture maker, he didn't have any knowledge or ex- pertise, but he saw an op- portunity." In over 30 years the fam- ily has transformed and ex- panded the business to meet local and global trends. It is now run by Nick and his two brothers-in-law, but his 73-year-old father still has an influential say in the busi- ness. Nick says it is vitally important to remain trans- parent at every level, and changes to the business mod- el are made as a family unit - and one of those important changes was moving beyond a manufacturing model. "We were manufacturing up until 2008. From 1995 we were bringing in com- plementary lines, importing products that we couldn't make here or that weren't vi- able to make here. So from '95 (that's when I kind of came into the business) we started to import and in 2008 we completely closed down manufacturing and we are now solely importing. "The biggest change has ob- viously been due to the im- porting and South-East Asian expansion into the furniture business - it was very hard to compete. But there's an old motto that says if you can't beat them, join them." With growth throughout South-East Asian countries booming and a fluctuating Australian dollar, many lo- cal businesses have found it difficult to justify maintain- ing a manufacturing line. Nick explains that the dif- ferences start with the min- imum wages set in Australia, compared to countries like Poland (which accordingly is the second biggest furni- ture exporter in the world) and Vietnam. "In Poland their minimum monthly wage is €300, let's say it's €400 all up including their superannuation. When you compare that, €400 equates to $600 a month and our minimum wages here in manufacturing are in excess or close to $3,000, it's five-to- one. In China or South-East Asia it's probably eight-to- one. So for every eight work- ers in South-East Asia, in Vi- etnam for example, it's equiv- alent to what you'd pay one person here in Australia. So we're way behind." Within the last year the business has ventured inter- nationally, and is now sup- plying overseas clients. Nick and company have also set up an office in China, and the ex- pansion so far is paying divi- dends. "It's pretty good! It's not a big part of our business but it's growing. We have a cou- ple of customers out of Afri- ca, so that was like a by-prod- uct of what we do. But when you're dealing with overseas factories and you've got the marketing and the product and you've done the devel- opment, then it's easier to expand into other countries. Which is a new phenomenon, it's only happened recently." Since 2008 LV Furniture has grown approximately 300 per cent, after it closed its manu- facturing arm. Maintaining business trends LV Furniture personnel Michael Karamitos, Nick Koukouvitakis, Stelios Koukouvitakis and John Zois. Local furniture wholesaler Nick Koukouvitakis talks to Neos Kosmos about how his family-run business keeps up with current markets JOHN PYRROS Businessmen Steven and Har- ry Tsalikidis and Athanasios Salahas have donated sixty thousand dollars to the new Greek Cultural Centre in Mel- bourne. "As a family, we are proud of being Greek and we help the community and other diaspo- ra organisations any way we can," Steven Tsalikidis said. "We are happy about the ac- tivities and all the work done by the community and we are proud of it. We wish for the community and the diaspora organisations to keep up the great work." His family donat- ed 50,000 dollars. On his part, Athanasios Sala- has, who donated 10,000 dol- lars said, "I have always sup- ported the community and I will keep doing so. I always believed that the Greek com- munity can thrive and, in some aspects, it has. It is democratic, united and we do things that our children will inherit." Salahas also said that there were many members of the Greek community in the past who doubted that the Cultural Centre would be constructed and now that they have seen it become a reality, they have changed their minds. President of the Greek Aus- tralian Community Bill Pa- pastergiadis thanked the businessmen for their dona- tions and continuous support. "We are all touched and this gesture has encouraged us to continue our work," Papas- tergiadis said. "We sincerely thank them for their dona- tions and we hope that oth- ers will follow their example because there is still a lot that needs to be done for the Cul- tural Centre, which is a lega- cy for generations to come.” Businessmen donate to Greek Cultural Centre Greek retailer AB Vassilopoulos to invest 100 million euros in 2015 Greek retailer AB Vassi- lopoulos plans to invest €100 million in 2015, which according to man- aging director Leonidas Vrettakos, will mostly be used for "the opening of new stores, both in Crete and northern Greece, and the renovation of existing stores". The company's manage- ment also believes that the process will lead to the creation of 1,200 new jobs. AB Vassilopoulos current- ly has 306 stores with a to- tal of 11,408 employees; investments from 2011 to 2013 reached almost €350 million. The retailer has ambi- tious renovation plans for its supermarkets, aimed at renewing its relationship with its customers. This major investment has led to the creation of outlets totalling 5,500 square metres, where con- sumers can, among other things, find fresh fruits and vegetables, breads and pastries, cheeses, meats and wines from all over Greece and the world, fine fish, aromatic freshly brewed coffee and nuts.
18 October 2014
1 November 2014