Cole Myers details revival strategy
Australian retailer implements range of strategies
September 25 2003
Australian retailer Coles Myer has unveiled details of a range of initiatives designed to boost the company’s performance across all its retail sectors.
Despite its standing as Australia’s biggest retail group, Coles Myer has been widely seen as underperforming, with chief executive John Fletcher pledging changes which would add value for both customers and shareholders.
Its retail chains including the Coles and Bi-Lo grocery brands, department store group Myer Grace Bros, discounter Kmart, clothing chain Target, stationer Officeworks, and furniture and electricals store Megamart.
A new supply chain strategy across the business will delver $425m a year in benefits over the next five years, said Fletcher. It will include better systems to improve on shelf-availability, technology to simplify processes and reduce costs for both suppliers and Coles Myer, streamlined deliveries into stores, and a more efficient distribution network with the potential reduction in distribution centres from 41 to around 24, without a reduction in jobs numbers due to forecast volume growth.
IT systems will also be upgraded across the group, aiming to remove complexity and duplication of systems, and implement common technology across all Cole Myer’s brands.
Fletcher said: “We believe Coles Myer as a group can be substantially greater than the sum of the parts and through these strategies we can realise a unique competitive advantage.
“Each and every strategic initiative has been built around delighting our customers and delivering sustainable returns to our shareholders.”
The business is also aiming for a culture change, recruiting the right people and building leadership capacity. Fletcher said: ‘If we don’t develop and motivate our people, if we don’t develop the best team we won’t get there – it’s that simple.” Last month saw Coles Myer appointed former Asda marketing director Steven Cain as managing director of its food, liquor and fuel arm.
A revamped loyalty offer will include the launch of a Coles Myer MasterCard with a loyalty option. With petrol sales a key area of competition in the Australian grocery market, there will be a focus on fuel discounts for loyal customers.
