Balancing Brookes
Step 3
Briscoe Group
Unpacking Briscoe Group
First Encounters with an Unexpected Company: Identifying Briscoe Group’s Purpose and Operations
Upon opening the link to discover my assigned company, I couldn’t help but hope I wouldn’t once again be met with another Kiwi Fruit Company company- thanks, as I experienced a semester or two ago when I unexpectedly had to withdraw from this unit. Ideally, I had imagined analysing an entity involved in bulk commodities or grain trading, industries that naturally align with my background. However, I was pleasantly surprised to find myself allocated to Briscoe Group Limited. This discovery also aligned unexpectedly well with a personal goal I set at the beginning of 2025: to finally engage with and invest in the share market. One of my New Year’s resolutions was to read company reports with confidence rather than avoidance, and I realised that taking on this task would help expand my repertoire for interpreting annual reports—something I need both as an investor and in my own business. While I was a little perplexed about the company's primary function, clarity came with a quick Google search. Briscoe Group operates through a small, manageable group of subsidiaries. It is primarily focused on homewares and also serves as the parent company of Rebel Sport NZ, a brand instantly recognisable across the retail landscape. This familiarity helped anchor my understanding of their business model, making the organisation far easier to grasp than more complex, multi-layered corporations. I also appreciated the accessibility of their reporting style; both the Board of Directors and Managing Directors' reports were written in a personable, almost conversational tone, which made the initial deep dive far less intimidating than anticipated.
Skimming the Surface: First Impressions of the Report
When I first opened Briscoe Group’s annual report, I had a moment of déjà vu with reflecting upon Daniel People’s commentary towards his company Kesko- that familiar eye-bulging reaction at the page count. While Briscoe’s report wasn’t quite the 140-page epic of some multi-level conglomerate giants, it was still substantial enough to make me quietly mutter, ‘Righto… guess we’re really doing this,’ before even scrolling past the title page. I couldn’t help but wonder whether companies ever expect the average person – or even their shareholders – actually to digest the entire document. Fortunately, the layout was gentle on a novice reader like me. The early pages feature a concise yet insightful Board of Directors Report, followed by a clear Managing Director’s narrative. These initial sections worked as a much-needed novice-friendly snapshot of what happened during the reporting year, what the company does, where it is heading, and how it has navigated the latest wave of challenges.
Across the three years of reports, the storyline evolves in a way that is easy to follow and is also quite revealing. The consistent message is that Briscoe Group is operating in what they describe as ‘one of the most challenging retail environments in decades,’ marked by high interest rates, slumping consumer confidence, inflationary pressures, and rising operational costs. Yet, despite all this, the company continues to deliver sales remarkably close to its record highs. A skim through each report reveals an interesting pattern: the positive, reassuring summaries sit upfront, and only when exploring the financial statements do the realities become more complex – falling margins, tightening profit, and rising expenses. Still, the front sections provided a strong sense of direction and transparency, also explaining not only what happened, but also why. This surface-level scan made me more curious: how is this company maintaining performance while almost every macroeconomic indicator seems to be working against them?
Behind the Brand: What the Reports Reveal Briscoe Actually Is
Reading on further, one thing became increasingly clear: Briscoe Group is far more than a homewares and sporting goods retailer. If anything, it operates similarly to a logistics and supply-chain engine that happens to sell retail products. Across all three reports, the company repeatedly emphasises its investments in distribution capability, automation, inventory optimisation, and merchandise planning tools. Their new state-of-the-art distribution centre (five time the size of their current one) is evidence of a business preparing itself not just for present challenges but for long-term transformation. This shift reframed the entire way I viewed the brand – instead of seeing Briscoe as a chain of stores, I began to see it as a highly coordinated network designed to make stock move faster, smarter, and more profitably.
Another key reflection came rom observing how Briscoe has navigated the past three financial years – from the tail end of COVID-related demand surges through to the tightening economic conditions of 2023-2025. In earlier reports, Briscoe benefited from strong consumer demand, particularly in homewares and recreational goods, as households continued to spend on their living environments. However, by 2024-2025, this buoyancy had faded. Interest rates rose, inflation ate into disposable income, and customers became more price sensitive. Despite this, clearance activity increased, and cost pressures intensified. Yet, the company's continued ability to deliver meaningful profit suggests a well-run model with strong discipline.
Looking towards the future, all three reports point to a similar strategic forecast: Briscoe expects the retail environment to remain challenging in the near term but is optimistic that lower inflation and easing interest rates will eventually restore consumer confidence. Their forecasts – while cautiously framed – consistently reference growth driven by more efficient supply chain management, stronger online capabilities, and enhanced in-store customer experience. It appears the company is deliberately positioning itself to thrive once conditions stabilize, rather than simply weathering the storm.
This deeper look behind the brand has helped me understand Briscoe Group on a more meaningful level. It isn’t simply a retailer riding out market fluctuations – it is a business actively redesigning its operational backbone, anticipating economic shifts, and preparing its stores, systems, and logistics for a more digitally blended future. Reading these three reports sequentially provided a vivid glimpse of this company's evolution in real time.
Opportunities & Risks
Across the three years of Briscoe Group's annual reports, one thing becomes strikingly clear: the same themes recur again and again. The company repeatedly discusses a mix of risks and opportunities stemming directly from the retail operating environment. This includes macroeconomic forces such as inflation, weakened consumer confidence, and rising interest rates; microeconomic pressures such as supply chain bottlenecks, labour costs, and competition; as well as structural issues, including store theft and digital transformation.
While the retail climate could be solely framed as a risk, opportunity can be gleamed in tough times, Briscoe reports to take on this challenge. Many threats identified in earlier sections of the reports later reappeared as opportunities for refining systems, improving efficiency, and strengthening the company’s long-term resilience. Reading these reports felt like stepping into a retail ecosystem where every problem has a flipside, every constraint triggers innovation, and every year’s financial outcome is shaped as much by external pressures as internal strategy.
Risks
Opportunities
Rising Operational Costs
Rising operational costs appear as one of the most consistent risks across the reports. Inflation and interest rate increases created significant pressure, particularly in FY2024 and FY2025. Despite near-record sales of $792.0 in 2024 and $791.5m in 2025, profit margins declined sharply. NPAT (net profit after tax) fell from $88.4m (2023) to $84.2m (2024) and then to an underlying $68m (2025). These numbers illustrate how costs – not sales – have become the dominant barrier to profitability.
Weaker Consumer Sentiment
Briscoe repeatedly describes the retail environment as one of the worst in decades. High mortgage repayments and reduced discretionary income have made customers highly price-sensitive. Forcing the company into heavier discounting, contributing to gross margin declines from 44.02% (2023) to 42.40% (2024) and 40.37% (2025). It was interesting to see how macroeconomic trends directly translated into measurable deterioration in the company’s financial performance.
Supply Chain Pressures
Supply chain issues remain a long-standing challenge. While global freight distributions eased somewhat after 2022, Briscoe still struggled with shipping delays, cost volatility, and complex inventory management. This risk links directly to margin pressure, as poor stock availability or excess stock leads to more clearance activity and increased handling costs.
Increased Crime and Theft in Stores
One risk, that although feeling relatively obvious- I did not consider how substantially retail theft affects the bottom line. Briscoe identifies rising theft as a growing operational costs, eroding profitability and placing pressure on store staffing ans security practices. This aligns with being a microeconomic factor, with very real macro implications, as this is a global retail sector issue.
Competitive Pricing Pressure
Intense competition within the retail sector of New Zealand was emphasised with in the report. With consumer spending continuing to decline, retailers have to fight harder for the same customers, leading to heavier discounting and reduced gross margins. This competitive pressure underpins much of the profit decline observed in the past three years.
Strengthening Online and Logistics Capabilities
One of Brisco’s most exciting opportunities lies in the development of its logistical transformation. The commitment to a new distribution centre five times the size of the current facility is one of the biggest investments in the company’s history. This isn’t just a warehouse upgrade- it positions Briscoe to accelerate ecommerce growth, reduce further fulfilment times, lower handling costs, and improve nationwide stock availability. While high supply chain costs are a risk, the ability to redesign that supply chain is equally an opportunity.
AI-Driven Merchandise Planning
Another key opportunity highlighted repeatedly in Briscoe’s investment in advanced merchandise planning tools. The use of AI and improved forecasting models aims to optimise inventory turnover reduce markdowns, and ensure stores carry the right products at the right times. This is essential in an environment where sales are steady but margins are tightening.
Enhanced Inventory Management
The reports emphasis a shift towards leaner stock positions. I found this particularly interesting because, while gross profit margins have declined, inventory performance has improved year on year. Better inventory management means better cash flow and fewer clearance-driven losses.
New Flagship Store Concepts
Although the world has moved online, Briscoe continues to see physical stores as a competitive advantage, not a liability. Their introduction of new flagship formats provides opportunities to modernise the in-store experience, strengthen brand identity, and integrate digital touchpoints such as click-and-collect zones. While some retailers are shrinking their store footprints, Briscoe appears to be strategically expanding theirs.
Anticipated Macroeconomic Recovery
A subtle but important opportunity is the expectation of easing economic conditions. The company references anticipated declines in inflation and interest rates- conditions that historically correlate with rebounds in discretionary spending. While this is speculative, Briscoe positions itself so it can capitalise quickly when consumer confidence improves.
By identifying its weaknesses and the factors that place it at risk, a company can carve out opportunities, in the hope that these threats will not further corrode the business's prosperity. As seen threaded throughout Briscoes years of reporting. Rising costs push the company toward efficiency; supply chain pressure accelerates innovation; weak consumer sentiment forces strategic reinvention; competition fuels investment in customer experience. Reading across the three reports revealed that retail success isn’t determined by eliminating risks, but by reconfiguring them into catalysts for growth. Briscoe’s ability to pair each challenge with a forward-looking strategy made me appreciate just how dynamic and multifaceted the retail environment really is.
KCQ #1- Shareholder Structure & Influence: Who Really Owns This Company?
When stumbling to the final pages of each report, the shareholder reports can be found, and year after year a similar story can be found. Below, I have compiled the top 5 shareholders for the past three years.
When comparing the top five shareholders across the last three reports (2023-2025), I realised they add further depth to the story of Briscoe Group than simply ‘who owns the most shares.’ Their combined holdings explain why the company behaves in certain ways- strategically, financially, and culturally. The shareholder list, much like the financials, shows patterns that repeat year after year, and those patterns form a narrative of stability, concentrated control, and long-term direction.
The first and most defining feature is that over 77% of the company is held through JB Were (NZ) Nominees, representing the beneficial interest of Managing Director R A Duke, who holds 171.6million shares.
Data Source: Briscoe Group Annual Reports (2023–2025).
Compiled by: Brooke Mifsud, based on publicly reported shareholder disclosures.
This has been consistent in all three years. What this says about Briscoe Group is that it is effectively a founder-controlled organisation, despite it being publicly listed. Strategic decisions, such as investing, dividend decisions, etc, are made with long-term confidence, as Duke is not trying to please short-term shareholders. I’ve learnt throughout this journey that this signifies stability of direction, as there are no activist investors, no boardroom turbulence, nor sudden swings in strategy. With a founder-driven business at the helm, an understanding of why this business is willing to invest through downturns as it answers to itself, not to volatile institutional expectations.
The presence of Harvey Norman as a major investor, alongside Gerald Harvey and Harvey Norman Properties (NZ) Ltd—each holding a 2.36% stake—warrants attention. Although these figures represent significant competitors, their investment in another retail company suggests notable confidence within the retail sector itself. The fourth-largest stakeholder is Accident Compensation Corporation (ACC), a New Zealand-based sovereign fund for injury compensation. ACC has increased its holdings from 2023 through 2025, indicating continued confidence in the company's long-term stability and prudent capital management. Rounding out the top five is Custodial Services Ltd, which aggregates the interests of multiple smaller or indirect investors. As with ACC, Custodial Services Ltd has consistently increased its position over the past three reporting periods. Overall, Briscoe’s investor portfolio suggests the company is perceived as a stable investment option, even amid fluctuating economic conditions.
KCQ#2- Financial Performance: A Plateau or a Warning Sign?
After entering four years of Briscoe Group’s figures into my spreadsheet, I expected to see peaks and troughs that matched New Zealand’s turbulent retail environment. Instead, what emerged was more uncomfortable: a business holding its revenue line while quietly losing profitability. Revenue in both 2024 and 0225 sat virtually unchanged at around $791 million, yet underneath this seemingly stable top line, the foundations began to shift. Gross margin slipped from 42% (2023) to 40% (2025), and NPAT fell materially- from approximately $88 million (2023) to $84 million (2024) and then sharply to $60 million (2025). Even allowing for the one-off tax adjustment noted in 2025’s report, the downward trajectory remains unmistakable.
What this made me reflect upon- drawing from Chapter 1’s key messafe that “accounting numbers are not reality; they help us connect to reality”- is that Briscoe’s financial statements reveal an economic reality that is shifting beneath the surface, despite sales appearing stable. If the top line is flat but profitability is falling, then something in the business’s underlying value creation model is being eroded. Chapter 3 of the Accounting Study Guide emphasises that businesses create value when benefits generated exceed the sacrifices (costs) required to produce them. Briscoe’s shrinking margin suggests that the costs are risging faster that the benefits, whether through wage pressures, freight inflation, store crime, discounting, or supply chain volatility.
These reflections leading me to a central question:
If sales remain stable but profits continue to shrink, how long can Briscoe rely on operational discipline before the business model itself needs to evolve?
This KCQ has pushed me beyond where the spreadsheet has led me. Akin to running a household where, for example, your income remains constant, but the grocery bills continue climbing, eventually, belt-tightening ceases to work. The problem is becoming structural, not operational. Briscoe’s reports increasingly empahsise ‘cost control’ as a strategic strength, but accounting theory reminds us that firms must create value- not merely defend it. If margin deterioration continues, Briscoe’s traditional retail model, including large stores, high inventory, and intense promotion cycles, may face limitations in a market increasingly shaped by online competitors and shifting consumer expectations.
By leaning into insights gained from Chapter 1, of how accounting helps us interpret the economic reality behind the numbers encouraged me to question: what is really happening inside Briscoe’s business? The declining NPAT telling a story not of failure, but of a retailer at a crossroads- caught between stable demand and rising structural pressures. While the company remains profitable, the trend line suggests that relying on historical strengths, such as strong brand reputation, may not be enough to protect margins in the future.
This KCQ has allowed a shift from simply reading the annual report to truly interpreting and seeing the business reality represented. I now understand why accounting is described as a “model of business reality ” (Turner, 2025, p. 2) rather than reality itself.
One of the most striking contradictions in Briscoe Group’s reporting is its unapologetic commitment to investing in physical stores. With online sales now approaching 20% of revenue—well above the New Zealand retail average—I expected to see store refurbishments taper off. Instead, Briscoe is accelerating capital expenditure: rolling out new flagship concepts, modernising layouts, integrating technology upgrades, and leveraging its enormous new distribution centre to reinforce the physical network. At first glance, this feels counterintuitive in a world supposedly “moving online.”
This tension led me down a research rabbit hole, searching for the statistical “tipping point” at which retailers typically pivot from bricks-and-mortar dominance to a more online-driven model. Surprisingly, I found no academic consensus on a numerical threshold—especially none that ties the decision directly to NPAT decline. What the evidence does say is more nuanced: shifts toward online or omnichannel retailing are usually triggered not by a specific profit figure but by sustained pressure on gross margins, store productivity, and logistics efficiency. Fang, (2023), for example, found no immediate profitability improvement when retailers adopted e-commerce, while Chava et al. (2024) showed that rising e-commerce competition systematically erodes margins for traditional retailers. Conversely, Wang et al. (2021) demonstrated that adding an online channel can enhance store performance when channels are well integrated, and Maier et al. (2023) found that omnichannel retailers—those that balance stores and online—often achieve stronger financial outcomes than pure-play online retailers.
In other words, the decision to expand online is a strategic one, not a mathematical one.
At this point, Chapter 2’s reminder that financial statements are a “virtual model of reality” rather than reality itself (ACCT11059 Study Guide, Ch. 2) became important. Briscoe’s commitment to stores, despite margin pressure and declining NPAT, may reveal more about its underlying assumptions than the numbers alone disclose. The chapter also warns us that managers must exercise judgement—and sometimes “spin a story”—when explaining strategy. This made me question whether Briscoe’s store-centric capital program reflects:
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True strategic conviction that physical stores remain the core of value creation, or
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A form of strategic inaction, anchored in the company’s historical identity, or
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An attempt to reassure investors that transformation is underway, even while financial pressure is mounting.
The industry research deepens this KCQ. Several studies argue that retailers shift toward online models when physical stores become less efficient—due to rising wage costs, theft, lease pressures, inventory imbalances, or diminishing marginal returns on refurbishments. Others show that online channels can stabilise revenue but do not automatically reduce costs; in fact, e-commerce can be more margin-dilutive unless fulfilment logistics are carefully optimised. Briscoe’s strategy—continuing heavy investment in stores while growing online to nearly 20%—suggests they are not replacing one model with another but trying to build a hybrid ecosystem where stores act as fulfilment hubs, brand anchors, and experiential centres.
However, the KCQ that emerged for me is this:
If Briscoe’s NPAT has been falling for three consecutive years, and if research shows that online adoption alone does not guarantee improved profitability, then what exactly is the strategic rationale for continuing to prioritise physical store reinvestment at this scale?
Is Briscoe reinventing its store network to function within a modern omnichannel model—or resisting an industry shift that will eventually force a more dramatic transformation?
This uncertainty, combined with the ambiguity highlighted in Chapter 2 about how financial statements “model” reality, makes this KCQ one of the most fascinating strategic tensions in Briscoe’s entire report.
KCQ#3 The Store Strategy Paradox: Reinvention or Resistance?
Slow Trading Continues for Traders
Tough Trading: Briscoe Group Crosses Fingers for 2025
Briscoe Group Confident, Despite Drop in Third-Quarter Sporting Sales
Some Good News for retail with much-needed spending uptick
1. Ben’s Blog – Key Concepts & Questions (Chapter 1)
https://benjaminnt32025.wixsite.com/s-blog
2. Sally’s “My Learning Journey” KCQs
https://sallyvico1.wixsite.com/my-learning-journey
3. Shelly Williams Blog
http://shellywilliams68984a5875-gytil.wordpress.com/
My Personal Top 3 Fave Blogs
I really enjoyed Ben’s blog because his honesty and humour made the content so easy to connect with. As someone who still feels like I’m trying to “get through” this unit, his comedic take on accounting reminded me that even as mature-aged students, we’re still allowed to laugh, question, and learn without fear. I loved how he broke down concepts like assets and liabilities in such a relatable way — it mirrored exactly where I’m at while also making the whole topic feel less intimidating and far more human.
Sally’s reflections quickly became one of my favourites because she articulated things I’ve been feeling for years — especially around leadership, financial literacy, and the confidence gap that comes with not fully understanding accounting. I connected deeply with her idea of shifting from memorisation to genuine involvement, because that’s something I’m trying to commit to as well. Her writing reminded me that building capability later in life isn’t a setback — it’s actually a form of growth, and her openness made me feel less alone in the process.
This post quickly became one of my favourites because so much of it resonated with my own reasons for re-entering the study space. I loved your insight about involvement rather than memorisation — that’s something I’m actively trying to change this time too by slowing down, questioning, and focusing on understanding the “why” instead of just the “how.” Your reflections on leadership also made me pause; I’ve spent years feeling confident operationally but hesitant in financial conversations, and you put words to something I’ve been feeling for a long time. It’s genuinely inspiring to see someone else leaning into growth rather than shying away from it, and I’ll definitely keep stickybeaking at your progress!