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Woolworths Limited

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This article is about the Australian company Woolworths Limited. For other retailers of similar name (including F.W. Woolworth and its associated companies), see Woolworth's.

Woolworths Limited is a major Australian company with extensive retail interest throughout Australia and New Zealand. Woolworths Limited is currently:

Woolworths Limited operates in Australia through several retail banners:

Supermarkets

Convenience Stores Liquor Petrol General Merchandise Consumer Electronics Former chains The Company also operates in New Zealand under the following banners:

Contents

Formats

Woolworths

Main article: Woolworths Supermarkets

Safeway

In Victoria, Woolworths trades under the name Safeway. Safeway Inc. entered the Australian grocery market in 1963 with the purchase of three Pratt Supermarkets. The subsidiary Safeway Australia was created, and by 1985 the chain had grown to 126 supermarkets trading under the Safeway banner across Victoria, New South Wales and Queensland. The Australian head office and distribution centre was (and still is) located on Wellington Road, Mulgrave, Victoria.

Acquistion by Woolworths

In 1985 Australia’s second largest supermarket operator Woolworths Limited successfully acquired Safeway Inc. Australian interests. In the agreement Woolworths Limited acquired all Safeway stores and the naming rights in exchange for a 19.99% interest in Woolworths Limited (which has since been sold). This transaction pushed the group’s grocery market share above Coles, giving Woolworths Limited the title of Australia’s largest supermarket operator (which it still holds to this day).

Safeway stores in New South Wales and Queensland were re-branded as Woolworths Supermarkets. However Safeway stores in Victoria retained their name, and all Victorian Woolworths stores were transferred to the Safeway banner. Mr. J.W.R. Pratt, Chairman and Managing Director of Australian Safeway Stores and Mr. P.A. Magowan, Chairman and Chief Executive Officer of Safeway Stores Inc (USA) were also appointed to the Woolworths Board.

In 1987 Woolworths and Safeway Supermarkets launched “The Fresh Food People” campaign, adopting a uniformed company logo and marketing strategy, which are still in use today almost 20 years later.

Today

Safeway Australia continues to trade today as Woolworths Supermarkets Victorian Division. Aside from 2 Woolworths supermarkets trading in the border town of Mildura all supermarkets in Victoria continue to trade under the Safeway banner. The brand has also followed Woolworths Supermarket’s progression into liquor trading as Safeway Liquor, and into petrol trading as Caltex Safeway. At the end of 2005 there were 180 Safeway Supermarkets trading in Victoria. With a few off the coast on island resorts.

Safeway’s Future

Since 2000 there has been much speculation in the market that Woolworths Limited is planning to absorb the Safeway stores under the Woolworths banner. The main reason for this consideration is said to be a cost cutting measure, as currently the company pays many duplicated expenses such as advertising. One large concern though is the possible loss of reputation and consumer identification, especially when it is consider that Victoria is the second largest retail market in Australia.

In the early 2000’s the companies supermarket interests in the smaller state of Tasmania, which traded under Purity and Roelf Vos were progressively re-branded as Woolworths Supermarkets (Tasmania and Victoria were the only states where the Woolworths name was substituted over the entire market). The transition took place through an extensive advertising campaign aimed at preserving the company’s reputation and market share. The exercise was closely watched by the company and the market, and was used as a comparison to the possible effects of a name change in Victoria.

Initially the name transition had little, if any, effect on the performance of the Tasmanian supermarkets, and hasn’t to this date affected Woolworths Supermarket’s growth in the state.

Food For Less

Main article: Food For Less

Food For Less is a chain of stores operated by Woolworths that sell dry groceries and frozen perishables only. Originally operating in Queensland, the stores built prior to 2001 had a more downmarket appearance. In 2001 however, after Woolworths purchased Franklins stores, the "No Frills" stores became Food For Less stores with a more upmarket appearance (edging closer to that of Woolworths) and a new logo.

Flemings

Main article: Flemings (supermarkets)

Flemings are a chain of small, innovative stores in Sydney acquired by Woolworths in June 1960. The first Flemings stores were opened in 1930 by Jim Sr. and George Fleming. It initially traded under the name "E.L. Lakin". Following World War II, the business boomed and the name changed to its current name "Flemings Food Stores". By the time Flemings was sold out to Woolworths, there were 55 stores operating under the "Flemings" banner in Sydney. The Fleming family continued operating the chain through Woolworths for the next 10 years before they had begun operating the now-defunct Jewel Supermarkets chain. Many Flemings stores were re-badged as Woolworths and Metro stores or closed off since, although 4 Flemings stores still exist (despite now being internally known as Woolworths) at Bexley North, Jannali, Pendle Hill and Umina(on the Central Coast). Nevertheless, the current Flemings logo was launched in the early 90s, although it is no longer internally used.

Woolworths Metro

Main article: Woolworths Metro

In 1997, Woolworths launched the Metro concept in Sydney, converting their premier variety store for 32 years to this format with the lower ground floor specialising in a large range of ‘prepared meals’ to cater for the increasing numbers of city dwellers, a kind of convenience store. It also became the name of convenience stores in key metropolitan areas (where the name "Metro" comes from). Subsequent stores opened in Coogee (ex-Flemings store), Boronia Park and West Pennant Hills in Sydney and Ascot in Brisbane. Stores that have since been sold off or re-branded are Newtown, Waterloo and its Sydney city store (all in Sydney). There are currently 4 stores operating in Australia. Its major competitor is Coles Central.

History

Woolworths store in the heart of Sydney (formerly Woolworths Metro)
Enlarge
Woolworths store in the heart of Sydney (formerly Woolworths Metro)

Woolworths opened its first store, the Woolworths Stupendous Bargain Basement in the old Imperial Arcade in Pitt Street, Sydney on December 5, 1924. Its nominal capital was just £25,000 and although 15,000 shares were offered to the public, only 11,707 shares were subscribed for by 29 people, including the 5 founders - Percy Christmas, Stanley Chatterton, Scott Waine, George Creed and Ernest Williams. The name on the draft prospectus drawn up by Cecil Scott Waine was "Wallworths Bazaar" - a play on the F.W. Woolworths name (the owner of the Woolworths chain in the US and UK). However, according to Ernest Robert Williams, Percy Christmas dared him to register the name Woolworths instead, which he succeeded in doing after finding out the name was available for use in New South Wales. Accordingly, the Woolworths Limited company in Australia has no other historical relation to the F.W. Woolworths Company in the USA. The new Woolworths store was innovative, it was the first variety store in the world to use cash registers to print receipts for customers.

Christmas also set up a New Zealand general merchandise operation in Wellington in 1929. Woolworths New Zealand opened its first food store in Auckland in 1956, and supermarkets in 1971. Woolworths New Zealand was sold to the company that is now LionNathan in 1979 and was later sold to Dairy Farm International in 1990, now owned by Progressive Enterprises, a subsidiary of Foodland Associated Limited of Australia. In 2005 Woolworths Limited and Metcash Holdings(IGA) agreed to purchase a demerged Foodland in which Progressive Enterprises and 23 of Foodland's Action brand supermarkets came under Woolworths' ownership. This acquisition brought total store numbers to near 750 in Australia.

During the late 1920s, the company grew with a second store in Sydney and opened stores in Brisbane and Perth and grew further in the 1930s, despite the depression, until by the end of 1933 when Woolworths had expanded to 23 stores. In 1933, the first store in Melbourne was opened. On April 1 1936, the company bought eight stores from Edments Ltd and opened its first store in Adelaide.

World War II slowed the growth of Woolworths and both the Australian and United States military used Woolworths' warehouses in Sydney for storage. After the war however, expansion was rapid and in 1955, Woolworths opened its 200th store in the Civic Centre in Canberra (since closed down). At this point Woolworths was still mainly a variety chain and had not moved into the food sector that it uses the "Woolworths" brand for today. This move began in 1955 when it opened its first supermarket at Beverly Hills south-west of Sydney. The company bought the Rockmans chain of women's clothing stores in 1960.

In the 1970s, the company started to open the first Big W discount department stores and the slow removal of many variety products from the supermarket and variety stores began, this process finished in 1989 when the last of the variety stores was closed and the "Family Centres" were split into separate Big W and Woolworths supermarket stores. Woolworths' acquired the Dick Smith Electronics consumer electronics chain in 1981 and later expanded the consumer electronics arm of its business with the purchase of the Tandy chain in Australia from InterTan Inc in 2001. Conversely, the company sold the Rockmans chain in 2000.

In 1985 the acquisition of the 126 Safeway stores in Australia made Woolworths the largest food retailer in Australia. Safeway stores were located in Victoria, New South Wales and Queensland and included Food Barns in Queensland and Northern New South Wales. The stores were acquired following an agreement whereby Safeway received a 19.99% interest in Woolworths Limited. All Woolworths and Safeway supermarkets in Victoria effectively traded under the one Safeway brand from then onwards while all of Safeway's Food Barns in Queensland and New South Wales became part of Woolworths.

Around this time, the supermarket chain had run 8 small supermarket chains including the Queensland-based Food For Less and the Sydney-based Flemings, which have both survived to this day.

In 1989, the company was acquired by Industrial Equity Limited (IEL) and remained a wholly owned subsidiary until 1993 when it was floated in the biggest share sale (at that time) in Australia's history.

In 1996, Woolworths entered the petrol market, initially with wholly owned "Plus Petrol" outlets located in shopping centre parking lots. In 2004, as part of a loyalty program aimed at attracting customers to supermarkets through the lure of 4 cents a litre discounts, Woolworths entered into an agreement with Caltex to co-brand some Caltex outlets as Woolworths petrol. These joint venture outlets are supplied with fuel by Caltex and with groceries by Woolworths, and accept Woolworths cards and discounts dockets.

In 1999, Woolworths began a joint venture with the Commonwealth Bank called Woolworths Ezy Banking.

In 1997, Woolworths opened their first Metro store in Sydney, converting their premier variety store for 32 years to this format with the lower ground floor specialising in a large range of ‘prepared meals’ to cater for the increasing numbers of city dwellers, a kind of convenience store. Subsequent stores opened in Coogee, Boronia Park and West Pennant Hills in Sydney and Ascot in Brisbane. Stores that have since been sold off or re-branded are Newtown, Waterloo and its Sydney city store (all in Sydney).

With growth opportunities in other sectors becoming limited, Woolworths started to expand into liquor businesses and purchased hotelier Australian Leisure and Hospitality Group in 2005. This acquisition added further liquor outlets to the group and signified a move by the company into hotels and gaming. In late 2005 Woolworths also acquired the Taverner Hotel Group, further cementing its position as Australia's premier liquor retailer.

External links

Woolworths Limited
Supermarkets (including Liquor and Petrol): Woolworths Supermarkets | BWS | First Estate | Dan Murphy's | Safeway | Woolworths Petrol''
General Merchandise: Big W''
Consumer Electronics: Dick Smith Electronics | Tandy''
Hotels: Australian Leisure and Hospitality''

 

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