By Corin Dann of RNZ
In New Zealand, people either dislike wealthy people, or admire them, says Rod Duke. The majority shareholder and managing director of Briscoe Group shared his thoughts as part of RNZ’s series, RICH: The meaning of wealth in Aotearoa.
When Rod Duke became the boss of the Briscoe Group in 1988, it was illegal to sell most things on Sundays.
Duke was willing to test the authorities’ mettle to enforce that law.
“We thought: ‘What are the fines? How can I get prosecuted? What’s the likelihood? How do I tell people that I’m going to be open on Sundays? How do I convince my staff to work?’”
They went for it, and before long Briscoes was doing the equivalent of a month’s trading on each Sunday alone.
The Labour Government of the time, which was in the midst of sweeping economic deregulation, was not interested in punishing Duke.
“We didn’t get prosecuted. We didn’t get shut down. No. The Government of the day thought it might be best if they change the legislation, rather than prosecute me.”
Duke, an expat Australian, is indelibly tied to the modern Briscoes story.
The “Briscoes Lady”, Tammy Wells, who has fronted a chorus of “sale, sale, sale” advertising for the company’s homewares for many years, is the public face of the brand. That might make Duke the guts of the operation. The “Briscoes Bloke”.
Duke was recruited from Australia in 1988 to turn around the struggling Briscoe Group for its Dutch owners and prepare it for sale. At the time, Briscoes had a good name but customers weren’t paying much attention to it, he says. The business had “gone to sleep”. After he came on board, the big step into Sunday trading followed.
In 1990, he took an even bigger step and bought the business himself, making him “one of the fellows in this country with the biggest overdraft in the world”. He reckoned there was no chance of failure.
Today, the Briscoe Group includes Rebel Sport stores and is worth over $1 billion. Given Duke owns over 75% of the shares, that makes him easily one of the country’s richest people.
In half the year to July, the Briscoe Group of nearly 100 shops across the country racked up record sales of $372 million. Profits were down on forecast – in part due to a one-off tax charge – but still around $33m. This, while the wider retail sector struggled in a recession and cost of living crisis that curbed consumer spending.
How have they done it? Duke points to having a good team of people, being debt free and a relentless focus on bettering his rivals.
“Customers know very well that a lot of retailers sell similar merchandise to me,” he says. “So it’s all about being more convenient. Better price, better deals, more honest, more reliable, it’s all those sorts of things that make people change what probably would have been a different shopping habit.”
In many ways it is this competitive streak that gets to the heart of what drives the 74-year-old to stay as Briscoe Group managing director, when he could have long ago retired to spend more time working on his golfing handicap.
“I want my business to be number one in their category. I want to be the most respected retailer in the country. To be the best.”
But isn’t that already the case, at least from a profitability point of view?
“We as a business have to expand. We have to. We have to grow, perhaps in an even larger market. So we’re looking at this country and Australia to grow,” Duke says.
“The game doesn’t end. … At the end of the day, I too want to leave a legacy. And this business is the legacy.”
It hasn’t always been about bold moves. A key feature of Briscoe Group’s success over the past 35 years under Duke is its slow and steady rate of growth and aversion to debt. Despite having expanded significantly with the establishment of the Rebel Sport chain in 1996, Briscoe Group is debt free with over $100 million in the bank.
Duke says being a bit thrifty by nature helps. “It’s a personality thing, right? I’m a bit thrifty, you know, I look for value. It’s a trait of being a son born in the post-depression years. It exists in me.”
As a well-known rich lister, Duke’s wealth has drawn public attention from time to time. Six years ago he lost a high-profile court battle to build a helicopter pad on top of his boatshed in Herne Bay.
Last year, he queried the IRD’s process in investigating the tax paid by New Zealand’s richest citizens. The IRD report concluded that 311 of our wealthiest citizens paid tax well below what average people pay (8.9% tax of their income). Duke went public about the fact he hadn’t been contacted.
“I don’t have any recollection of speaking to anyone from the IRD. In fact, I have a couple of wealthy neighbours who I jumped the fence and asked them and they haven’t even been spoken to. Governments have different ways of trying to sell things to the public. That particular Finance Minister, I think was at the time fixated on a wealth tax or a capital gains tax or a tax of some description.”
Duke has serious reservations about such a tax, fearing it would cause money to leave New Zealand. “Look, money seems to navigate to the place that’s easiest to make extra money and so if New Zealand were to introduce an additional or a modified tax system that was prohibitive and made investment more difficult or less lucrative, then the money would disappear.”
This year, Duke was made a Companion of the New Zealand Order of Merit, recognised for his business acumen and philanthropic work. His charitable work, carried out through the R.A Family Trust and First Foundation, covers such things as tertiary scholarships, funeral cover for Briscoes employees, financial support for Cure Kids, the Westpac Helicopter Trust, and mental health programmes for young people.
He says it’s not something he likes talking about. “I and my family, you know, have some causes that we love to support, but I feel squeamish talking about it. I don’t like doing that at all. You know, I’d like to keep those sorts of things between the charities and the trust.”
Is squeamishness talking about wealth a particularly New Zealand trait?
“I think in this country we’re a little different from the United States. Over there, if you’ve made a lot of money and you shared it around and you look after causes that you believe in, I think you’re generally looked upon as a model citizen.”
Duke believes when it comes to how wealth is viewed in New Zealand, there are two groups of people.
“There is a group that dislikes wealthy people because of how they think they become wealthy. And there’s another group of people who admire and look up to successful people and want to do exactly the same for themselves.”
It is hard to make money, he says, and if people choose to hang on to it, then that is their prerogative.
“If you make the money and you work hard and you put your family and everyone through the rigours of making money you should be able to hang on to it if that if that’s what you want to do,” he says.
“I personally don’t choose to do that. I want to be able to build schools and employ teachers and spend my money in a whole bunch of different ways that I feel good about.”
- RNZ
'Debt becomes more like a rent payment that people get so used to paying.'