Sydney's Winning family is closely examining the option of a partial public float of the Winning Group, which generates about $400 million in annual sales from online businesses led by Appliances Online and 12 retail stores selling high-end kitchen and laundry appliances.
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The company is accelerating expansion plans and looking at how to fund the next stage of growth for the online businesses, which also include the Big Brown Box operations selling televisions, audio equipment and phone accessories. It operates at a lower price-point than Appliances Online, which sells premium products including Smeg ovens for more than $3000 each and Asko front loader washing machines at $2500-plus.
Winning Group will next month rebadge three retail outlets in Perth now trading under the Kitchen Headquarters brand to bring them into line with the nine other bricks-and-mortar stores under the Winning Appliances brand in Sydney and Brisbane.
It is also heavily investing in back-end logistics in warehousing and delivery systems to allow higher throughput of big-ticket items in its online arm and may expand into the affluent Canberra market with a bricks-and-mortar store.
Winning Group is owned by the Winning family, which includes chief executive John Winning, his father, John Winning snr, and Peggy Formosa, a sister of Mr Winning snr. John Winning, 30, took over from his father in 2011.
The company would not comment on the possibility of a partial float.
Sales revenue across the group was about $400 million for 2013-14, not including the contribution of the three Kitchen Headquarters stores acquired in late June from Perth vendors Rick Hart and Nick Kirby.
The online businesses Appliances Online and Big Brown Box make up more than half of the total sales across the Winning Group. Sales growth from the online businesses was 35 per cent in 2012-13 and 17 per cent in the bricks-and-mortar stores. In 2013-14 the sales growth is understood to have produced strong figures again, with the online arm growing the fastest.
Investment banks Citi, JPMorgan and Rothschild are understood to be advising the Winning family on expansion options, which may include a partial float on the Australian Securities Exchange.
Paul Greenberg, executive chairman of the National Online Retailers Association, said that at a broad level fast-growing online businesses required substantial capital spending because of the "increasing complexity of the supply chain".
"A lot of retailers are offering multiple touch points and the game is won or lost in the supply chain," Mr Greenberg said.
Warehousing, logistics and sophisticated information technology systems tying them together were becoming more expensive.
Mr Hart, a former president of the Fremantle Dockers AFL club, is a WA businessman whose Rick Hart brand of electrical stores in WA were part of the Clive Peeters chain that collapsed in 2010, in part because of a substantial internal fraud at Clive Peeters' Melbourne headquarters by a company accountant.
Mr Hart will be part of the Winning Group company as Kitchen Headquarters in WA transitions into the stable.
The Rick Hart brand disappeared from WA retailing in 2011. This was a decision made by its new owner, Harvey Norman, which bought the remnants of the Clive Peeters business nationally for $55 million in 2010, including more than 10 Rick Hart stores in WA.
Harvey Norman scrapped the brand after finding the operations had not performed as well as it hoped.
