2009 focus

customer needs

Structure the product offers to support our customers in
difficult economic times.

store formats

Deliver larger format food stores with deeper ranges
and improve cataloguing against specific store customer
profile.

fitter businesses

Continue the focus on productivity and manage cost growth
hard in all aspects of the business.

the Woolies difference

Support the Woolworths difference in every aspect of our
business, doing what we do better.

retail overview

Last year was planned as a year to fundamentally overhaul our clothing business and to continue growing our food business through the rollout of our convenience food stores. The onset of the recession in the retail sector prompted us to adapt to the changing market conditions.

In clothing the buy had already emphasised the better and best product and had to be adjusted for the new conditions. Towards the end of the period, however, we were able to sharpen our clothing price points. Average price movement for clothing closed the year at 7.3%, down from a high of 9.6% at half year – indicative of the stronger focus on value, especially at opening price points, but without compromising on quality.

In food we were able to respond more quickly and provide our customers with an extremely competitive offer and an uncompromising commitment to quality and innovation. Prices have been sharpened on more basic commodities and they are now highly competitive. We are supporting this pricing strategy with a regular promotional strategy.

At the same time we implemented major changes to our clothing business. We fundamentally changed our buying structures by separating buying and planning, and have re-engineered our clothing merchandise cycle which should provide us with a more robust framework for buying in the future and flexibility as it improves our speed to market.

Our improved understanding of our customers is driving our planning and our buying decisions – precisely honing Woolworths ranges to suit our customers’ lifestyles – and making our stores clearer to shop.

Country Road was launched in four stores, offering customers a modern clothing range. Twist was launched in 26 stores around the country for a more contemporary customer. The new ranges complement the WCollection, studio.w and SA Designers collections.

New organic ranges in food were launched during the year, significantly increasing the number of organic products on Woolworths shelves and ranges were relaunched, including yoghurts, offering customers wider choice and variety.

We reviewed our rollout of stores with a preference for fewer but larger stores. 42 new stores were opened during the year, most of them Food stand-alones or Woolworths Food Stops. The convenience of the Woolworths food offering retains a strong appeal for our core food customer and we continue to invest in these formats.

Our ongoing emphasis on nurturing and growing appropriate talent, is supported by the retail academy and the recent launch of the merchant academy for buying and planning.