HAROLD'S WISDOM: PART 2 OF 3

Written by Denise O’Gorman, daughter of Harold Cornock

That old saying “The harder you work, the luckier you get” was a favorite of my father. Not only did he work hard, but he taught my sister and I, and a lot of other people, a strong work ethic by example. Whatever Dad did, he found a way to make money. From boyhood and throughout his life he kept bees, and sold the honey.

As a young boy, he and his brothers trapped rabbits, dressed them and sold them to the local butcher. Having a hobby breeding canaries led to advertisements in the local newspaper in which he sold his canaries. Dad left school during the depression to work as a delivery boy. Different jobs led to him becoming a manager of a general store called Selfridges in the coastal town of Wollongong. There, he married Dorothy, another worker at the Selfridges store. They opened a small general store that my mother managed and worked in full time, while my father remained at Selfridges. This meant that I, as a baby, was looked after by my paternal grandmother. My parents had this store during the forties when there were no chocolate biscuits for sale, so my mother dipped biscuits in melted chocolate and sold the only chocolate biscuits in town. When peace was declared after World War 2, Dad drove to Sydney, collected a van full of Australian flags and sold out of them so quickly that he made an additional trip to Sydney to obtain another load of Australian flags.

Later, with a couple of partners, he purchased a distressed hardware store, sold off the surplus stock at a huge discount (thereby paying for the purchase price of the hardware store) and continued to operate a thriving business by undercutting the opposition in price. Another venture that he took on was the purchase of a biscuit manufacturing business called Dad’s Cookies. Around 1947, my parents moved to Sydney and purchased an old house. Dad proceeded to renovate and sell this house so that he could afford to buy a bigger and better home in a more expensive neighborhood. In the back yard of the house, my parents raised chickens, which Dad would kill and dress and then sell in the local hotels on Friday and Saturday.

Around the 1950s, Dad was employed by Grocery and General and was sent by that company to America to investigate the new supermarkets there. He and another employee, Norman Tieck, travelled from one side of America to the other, and then returned to Australia and converted Grocery and General stores in Australia to self-service. Having received an education in self-service from their American travels and having put the knowledge they obtained into practice for Grocery and General, Dad ventured out on his own, buying 10 run down, over-the-counter grocery shops called Franklins. He converted them, one by one (constructing the shelving himself, laying line tiles, etc.) to self-service. Norman Tieck came in as a partner and over time they purchased more and more stores and built a business that was, for a while, the largest privately owned company in the southern hemisphere. Dad and Norman Tieck were invited by Hong Kong Land to convert their supermarkets in Hong Kong to the Franklins model, which they did with great success. Partly due to my father’s ill health, Franklins was sold in 1969.

A couple of years later, after regaining his health, Dad purchased 3 country properties, all located on the edge of a river, and all in need of improvement. He had a great time improving the fencing, pasture, watering systems and sheds, raising cattle and sheep and growing different crops such as tomatoes, lucerne hay, sunflowers. And of course, he had his beloved bees that he had carted from location to location over the years. These are just some of my father’s achievements. Can you see the common denominators here?

• An eye for opportunity

• Obtaining something and adding value

• Teaming up with like-minded people

• Hard work

IMPORTANT LESSONS

To live within my means. That meant if I had $100 I was not to spend $110. If I had $1,000,000 I was not to spend $1,100,000.

To have a dream and work to achieve that dream.

To work towards having my money work for me, instead of working for money. That meant building up a surplus to invest so that cash flowed back to me.

To value even the smallest amount of money. Without starting with a small amount, a greater amount can never be achieved. Every small amount adds to the pot, as does every large amount.

To seek bargains. Franklins prospered because it offered amazing specials to its customers. I packed shelves at the Franklins stores over school holidays as a young girl, and I became aware of the advantages of buying under-priced items. To this day, I look for specials in supermarkets, petrol stations, and department stores for household items and sales for clothing. My husband and I purchased a run-down country farm that that been on the market for more than a year because nobody else wanted it. We did up the old fibro cottage so that it was livable, and my husband, a wholesale butcher, raised cattle on the farm. We eventually sold it for a nice profit.

To understand that everything goes in cycles. Dad believed that land and property were the best assets to have when the economy turns down/goes into recession, as long as you can afford the holding costs until the cycle inevitably turns up again. He lived through the depression in the 1930s and was always prepared for the next recession/depression.

To know that assets do not always appreciate; so we were encouraged to plan for, and be prepared for, a worst-case scenario. That was also the best time to look for opportunities.

“Turn the light off” and “Turn the tap off”. These mottos were not just to save family bills, but Dad also regarded such things as a natural resource that we should all be mindful of and preserve.

To understand that money is an asset that is constantly losing its purchasing power. This is especially so since Richard Nixon abandoned the gold standard in 1971, which left government free to print money as it wished. (Previously the government could not print more money than it held in gold.) While money is a depreciating asset, land, real estate, physical gold, shares all can be appreciating assets (of these, only real estate can be insured). So, save money and put it into an appreciating asset.

To use the banks. Don’t let the banks use you. This means paying off credit card debt in full before the due date, every month. If you cannot do that, don’t use a credit card.

To get a great accountant and attorney. You need to work with someone who can advise on ways to legally minimize the amount of tax payable.

To hold assets in a company rather than in your own name. After all, company taxes are less than personal taxes.

To be the “green apple” in a bucket full of “ripe apples”. Meaning, always be ready and open to learn more from others that know more than I do. And be the listener and learner, rather than the one doing all the talking. At the first business meeting I attended with my father, I was instructed to, “Just listen. Don’t talk.” He did not talk much either. He was there to get advice from his accountant and attorney.

Dad and Norman Tieck were proud of providing groceries to the housewife cheaper than any other supermarket was doing at the time. They both felt they were providing a community service. I recall that my parents were always helping people out in different ways. As they prospered my parents were able to give financial assistance to many who were in need. I was taught, again by example, that if I was doing well, or not, I was always able to help others.