It’s good to see Woolworths executive Dave Chalmers in the AFR this morning finally fessing up to some of the company’s woes. Most of the focus until now has been on stemming the losses from Masters, but Woolies has plenty of problems in its core supermarkets business too. When the New Zealander turned up in Sydney to take on his new role as head of Woolworths Supermarkets, Chambers says he was shocked by what he saw in stores:
Shelves were low on stock, the trolleys had seen better days, floors were in disrepair and customers were forced to queue at the checkout
He’s not joking. My local Woolworths is in a state of disrepair. So bad was it a few weeks ago that I started taking photos with my mobile phone. These are prime display shelves with not a product on them. Boxes are strewn all over the floor and there is not a staff member in sight.
It wasn’t as if I was walking around the store at three o’clock in the morning. This was a Tuesday night at 6:30pm. This next photo is of the most important display shelf in the whole supermarket. Every person who enters the store walks through a small fruit and vegetable section and then down a ramp into the main supermarket. This is what greeted me:
Half price all right. It will be Woolworths shares trading for half price if they don’t get their act together soon. Chambers has $65m set aside to fix the company’s problems. He’s going to need a lot more than that.
I was going to say that looks like Tuesday evening. And then you confirmed it later on.
That’s not the standard state throughout the whole of the week. It occurs as those are all displays for specials – which end Tuesday, with the next set up ready for Wednesday.
As long as the specials are still available in the regular stock section (and if not you could get a rain check any way), that seems fine.
It’s where regular shelves are empty, so people want to buy something but can’t that there is an issue.
my local Woollies at Brassal is always well stocked with great fresh food and obviously well managed. Three others in Ipswich are similar while one is very tired though not as bad as the above experience. This might suggest factors like store age and local management may be the problem. If so it might not be quite as hard to fix
Looks a bit like a Coles 15 years ago.
They are getting ready for nightfill by the looks of it.
I assume Steve based on your comments you don’t see WOW as a buy yet?
Hey Steve, the catalogue refresh is Tuesday night in readiness for Wednesday new weekly specials.
Though it’s good to walk into Coles to see what they look like at the same time. I know my Woolies restocks during the night every night. But during the day it is well stocked and we’ll presented.
My issue with Woolies is their investment in stuff like cafe in store, sushi bar and pizza bar in store. They are moving into a area of retail out of their league, prices of their sushi is around $10-15 for take away sushi. It just doesn’t work, too many restauran options at tthat price range. Wasted capex.
Having little or no end stock on a Tuesday night is successful inventory planning. Surplus stock sits around tying up inventory space when the promotional price returns to normal on Wednesday morning. Woolies gets most things right but is getting hammered by the great Aussie knocking machine. In 3-5 years Woolies will be back on top.
Let’s hope they start with their store at Strathfield, and I can assure you that it’s condition is nothing to do with lame excuses about getting ready for restocking etc. It looked to me like management neglect.
Perhaps a case study in how not to let a store deteriorate in a prime shopping space.
Only went once and that was enough for me.