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Bernardi's case study

A case study that illustrates the pros and cons of the 'fail fast' approach.

“Fail fast” is something of an innovation mantra in business circles, but Joe Bernardi knows that taking risks that don’t pan out is no small thing – even if it can deliver essential learnings and open the door to new opportunities.

Joe and his brothers David and Peter run Bernardi’s, a chain of independent NSW supermarkets under the IGA umbrella with their father Tony, who launched the business 60 years ago selling fruit and veg from the back of a truck.

The supermarket business might seem like a daunting space for independent operators, but the Bernardi's stay ahead of the curve through rigorous attention to product quality, keeping a close eye on pricing and maintaining a large warehouse that allows them to make strategic bulk purchase decisions.

Fail fast

Today the family runs five independent supermarkets in central-west NSW, with more than 400 staff. This includes a newly launched store in Wagga Wagga, the third to be opened in a regional centre. The first was in Bathurst, which is the largest trading store in the network. The second, in Dubbo, was opened and closed in the space of a few years, bringing with it the painful lessons of the “fail fast” approach.

“It took us a couple of years to regroup. It was a very steep learning curve and led us to a major reflection on where we sit in the market,” Joe says.

Positive signs

They learned that their stores do better in a standalone location and that it was time to step away from their existing operating model to an entirely independent model. These lessons have been implemented in the business and while it’s early days, the signs are positive for the new store and for the business.

But learning from their mistakes is nothing new to the Bernardis. As patriarch Tony puts it: “You don’t buy knowledge - you learn by making mistakes and you don’t make them twice!”

Things you should know: This article is intended to provide general information of an educational nature only. It does not have regard to the financial situation or needs of any reader and must not be relied upon as financial product advice. The findings of the FY2018 CommBank Business Insights Report are based on a wide-ranging quantitative survey of 2,473 business owners, decision makers and managers — as well as 16 in-depth qualitative interviews — conducted on behalf of the Commonwealth Bank by ACA Research and DBM Consultants between August and October 2017. Participants were drawn from businesses across Australia with an annual turnover of more than $500,000 and at least two employees. The survey was designed to benchmark the innovation performance of each business, identifying the key motivations and drivers influencing that performance, and highlighting best practice. Any opinions, conclusions or recommendations set forth are subject to change without notice. Commonwealth Bank of Australia ABN 48 123 123 124 AFSL and Australian credit licence 234945.