Narta CEO Michael Jackson has publicly responded to JB Hi-Fi Group’s decision to end its membership, describing the split as mutually agreed and saying the buying and services organisation will adjust its cost base while continuing to serve independent retailers.
In comments after the announcement, Jackson said there was no triggering event, incident or disagreement behind the exit, and that JB had not been asked to leave. He said both organisations had concluded that Narta should focus on its strategy and members, while JB should focus on its own priorities.
Scale and market position
Jackson said Narta remains a substantial business without JB. He cited core supplier purchases of well over $1 billion and said Narta collectively represents more than 20% of the consumer electronics, camera and home appliance market. He also said Narta would no longer be the largest buying group but would remain number three collectively.
He traced the relationship back more than 25 years, when JB joined with stores in Melbourne and Parramatta. Jackson said Narta was proud to have been part of JB’s growth into a listed company. He said the later acquisition of The Good Guys and its entry into Narta added scale but created a significant imbalance across membership, and that COVID-related growth overshadowed those changes for a time.
Services and independent channel
Jackson argued that Narta’s role extends beyond buying. He listed forecasting, stock-on-hand visibility, end-of-life management, new model implementation, product content, training, predictive analytics, AI and automation among its services. He said independent members need to work collectively to access the technology, services and investment required to compete with major retailers, including JB Hi-Fi, Harvey Norman, Bunnings, Woolworths, Big W, Costco and Amazon.
He said JB agreed during discussions with Nick Wells that Narta had taken the right path by investing in its service infrastructure over the past five to six years. Jackson added that suppliers want a strong independent retail channel and value choice, competition and balance in the market. He said supplier response in the 24 hours after the announcement had reinforced his confidence.
Costs and structure
Jackson acknowledged that losing JB’s scale would affect Narta’s income and operating costs. As a not-for-profit organisation whose members contribute to running costs, Narta will need changes to its structure and cost base. He said there would be difficult decisions, including redundancies and cost reductions across the board and executive structure.
He said the priority was to keep Narta financially sustainable and retain the experience and capabilities needed to deliver for members and suppliers. Jackson also said the leadership team and board would remain, and that Narta’s purpose of strengthening independent retail had not changed.
He said the next 12 months would test collective action, with members needing to engage fully with Narta’s services and demonstrate efficiencies and competitive cost to serve. Jackson said Narta expected to be judged by its collective actions over that period.