Some cheese with your paint?

When a hardware store is run by a dairy processing collective, it should come as no surprise that there are some “unusual” items (and smells) behind the counter…

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Store: Tatura Milk True Value Hardware
Owners: Tatura Milk Industries dairy farmer collective
Group: Mitre 10

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Tatura Milk True Value Hardware, located west of Shepparton in northern Victoria’s Goulburn Valley, is a hardware store in the heart of a food bowl. The store is a business unit of Tatura Milk – a dairy processing plant owned by 415 local dairy farmers who supply milk to the operation.

Tatura Milk True Value Hardware can be found in northern Victoria’s Goulburn Valley

That means the hardware store is intrinsically bound to the vicissitudes of the dairy industry and local small farming communities, and this narrow market leaves the store vulnerable to the highs and lows of a single-industry clientele. Its trading methods are therefore of relevance to anyone running a store in an isolated or industrially homogeneous region.

While the clientele might lack demographic diversity, the store more than makes up for this shortfall with its own mixed product range, from fuel and cheese to general hardware and cut lunches for the dairy staff!

Small tin shed
According to manager Russell Holman, the store was established in 1952 as a “one-man operation run from a small tin shed”, and has since grown into a large enterprise with 14 full-time staff. It currently occupies 1,000sqm of retail and warehousing space, with an extra 10,000sqm of yard.

Most trade customers purchase plumbing products

“Suppliers of milk to Tatura Milk Industries (TMI) make up the majority of the store customers,” says Holman. “The customer spread is 75% farmer based, 15% trade (majority plumbing), and the balance is local townspeople and TMI employees.”

As happens with a lot of businesses that depend on a single niche market, the store has been subject to great pressure from the recent drought. In the face of direct and severe pressures associated with low rainfall, store practices have had to change in recognition of prevailing hardships. Growth plans for the store have been postponed, and staff have also made sacrifices.

“Further expansion for the store has been identified, but with the Goulburn Valley in the grips of a once-in-100-year drought, these plans have been put on hold,” explains Holman, who still hopes to open a sub-store (300sqm plus yard) in July this year at Katandra West General Store, about 80kms away.

Merchandising is well maintained

“The drought has impacted our customers, particularly the farmers who have had to suffer half their water allocation, lower milk prices, and increased feed costs. Disposable income has been very scarce. We have had to revise our strategies to support our customer base as best we can.

“The store staff have given extra time outside of work, becoming involved in community activities that have been designed to support our customers during this difficult time. By participating in these activities the staff have not only gained a better understanding of the problems facing our customers, but their involvement has also been great for staff morale.”

What the Heck

(l&r) Assistant manager, Peter Leahy and store manager, Russell Holman

So what else can be done to shore up business in difficult times? Holman says marketing, membership of a group and some clever sourcing of supplies all play a part in success.

“The decision to join the Mitre10 group was taken early in 1991 with the inception of True Value Hardware,” he says.

“Tatura Milk has always been innovative with its promotions and marketing over the years. Drovers’ dog dashes, wheelbarrow races called by the legendary Jack Styring, and the annual ‘What the Heck’ promotion have been exceptionally successful. Development of our own catchy Tat Milk jingle by the then manager Paddy Kerrins has been widely used on radio and was used as background for a television campaign.

The Cheese Board attracts customers from afar

“Being a diverse store we are members of more than one buying group. Our rural supplies are supplied by Wesfarmers. We run a retail fuel operation with our fuel being supplied by Shell, and our dairy case contains many varied cheeses that attract customers from afar. Many of these cheeses are manufactured by Tatura Milk.

“Hardware sales are 13% of total sales yet make up 28.5% of profit,” he adds.

Advertising, an equally important factor in the health of the business, is done via the True Value catalogue program. The store also produces its own flyers – distributed via the milk tankers direct to customers! Additional seasonal catalogues are complemented by TV and radio campaigns.

“The company is also very committed to training and supporting staff,” explains Holman. “The retail staff have just finished Retail Certificate 2 and will commence Certificate 3 this year. The store also puts strong emphasis on safety ensuring all staff are adequately trained in OH&S.”

As a progressive and community-minded operation, the store plays a fundamental role in the lives of nearby residents. It maintains a high-quality and selectively “boutique” inventory, and is therefore a reflection of local civic pride and independence.

Story by John Power