Woolworths Group Ltd (ASX: WOW) is adjusting its supermarkets to cater for changing customer preferences.
Woolworths was founded in 1924 by Percy Christmas, its first store was opened in Sydney’s Imperial Arcade. Woolworths is Australia’s largest supermarket business, it operates Woolworths supermarkets in Australia and Coundown in New Zealand. It also runs the retail department store Big W. With over 3,000 stores and more than 200,000 employees it’s one of Australia’s largest employers.
What’s Woolworths Working On?
According to reporting in the Australian Financial Review, Woolworths is going to change how its national supermarket network operates.
Consumers want more of a focus on convenience, fresh food and better service. So what is Woolworths going to do to address these wants? Well, it’s going to make two new departments called ‘fresh service’ and ‘fresh convenience’.
The AFR revealed that ‘fresh service’ will cover seafood, butchery and delicatessen whilst fresh convenience will be on top of dairy eggs, pre-packaged meat, branded bread and convenience food.
Woolworths has held successful trials in a handful of stores in New South Wales this year.
The supermarket has committed to no net reduction of staff from the changes, but there would be role changes, a shift to elsewhere in the company or redundancies.
Woolworths plans to introduce these changes over the coming months and will spend over $10 million on training and creating more management development roles.
Will This Work?
It will be down to customers voting with their wallets to show if this strategy works or not. Woolworths isn’t going to win customers on the lowest priced products, it will be on factors like range of products, quality of products and the service levels of staff.
Woolworths has returned to growth in recent times, but I think there are better options out there for growth over the long term. For example, the reliable businesses in the free report below could be what your portfolio needs more than Woolworths shares.
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