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AUSTRALIA: Woolworths revamping stores to help fight off increased competition

| International retailers

Amid intense competition in the Australian supermarket sector, Woolworths has revealed that it will spend A$65m over the next year on refurbishing its stores and improving customer service and stock availability.

The group is also hoping to make its supermarkets more inviting, including opening up the front of stores by removing gates, replacing aging trolleys and installing better lighting.

The move is being instigated by Dave Chambers, Woolworth’s new director of supermarkets, who told Fairfax Media that customer experience would be at the forefront of the store revamps. “What we're after is having a great store every day for our customers," Chambers said. "We need to have stores in the right place, we need to have a great network looking forward, we have to have the right price and we have to have a great experience for the customer. All those elements need to be working very well – this is the last piece.”

Chambers also revealed possible changes to store formats, opting for four types of stores labelled as premium, mainstream, mainstream rural and budget. "We need to think about how customers are shopping, not just today but where customers will be," Chambers said. "We might see more value-oriented stores that have more space given to good products but in affluent communities more space given to best products."

Last month Woolworths announced a worse than expected drop in full year profit, down 12.5% to A$2.15bn. The poor performance has led to its Chairman Ralph Waters and CEO Grant O’Brien resigning with the group saying it was looking “to find new leadership to reinvigorate the business”. The group has struggled in recent years amid increased competition from its traditional rival Coles and the fast-growing discounter Aldi.

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