AU: Westfarmers pleased with direction of Coles
In a strategy briefing yesterday, managing director Richard Goyder labelled the Coles supermarket chain as a ''bold turnaround'' story. The division has boosted food and liquor sales from $21 billion to an estimated $26.5 billion this year.
Coles also plans to increase its floor space by two per cent each year as it continues its battle with Woolworths. Coles expects to open 19 new stores, close eleven, and extend 10 stores in the 2011/12 financial year. Up to 400 stores are set to be refurbished.
The investor briefing came as April retail sales fell 0.2 per cent, below market expectations, adding to the weak retail sales outlook particularly on the eastern seaboard.
Several economists said the weak data strengthened the case for further interest rate cuts, following the ANZ forecast of another 0.75 percentage points in cuts by the end of the year.
Coles's managing director, Ian McLeod, argued that the cheaper, unbranded groceries were good for customers.
"With many Australian families facing higher household bills, finding ways to save money is more important than ever.
''Offering a choice of quality private label products alongside their favourite brands is one way Coles can help,'' he said.
''Australian consumers were paying too much for most consumer staples in the decade until 2009 until Coles started to cut food prices and provide better quality but lower priced private label products.''
Source: smh.com.au
