Woolworths Supermarkets Explained

Woolworths Supermarkets
Type:Subsidiary
Trade Name:Woolworths
Location City:Bella Vista, New South Wales
Location Country:Australia
Num Locations:995[1]
Num Locations Year:2022
Key People:Brad BanducciCEO, Woolworths Group
Annette KarentoniChief Supply Chain Officer
Natalie DavisManaging Director, Woolworths Supermarkets[2]
Industry:Retail
Parent:Woolworths Group

Woolworths Supermarkets (colloquially known as "Woolies") is an Australian chain of supermarkets and grocery stores owned by Woolworths Group. Founded in 1924, Woolworths is currently Australia's largest supermarket chain with a market share of 33% as of 2019.[3]

Woolworths specialises in groceries (vegetables, fruit, meat, packaged foods, etc.), but also sells magazines, DVDs, health and beauty products, household products, pet and baby supplies, and stationery. As at June 2023, there were 995 Woolworths supermarkets and 90 Woolworths Metro convenience stores. Woolworths Online (formerly HomeShop) is a click and collect, and home delivery service for Woolworths supermarkets.

History

Woolworths Limited (now Woolworths Group) was founded on 22 September 1924 by five Australian entrepreneursPercy Christmas, Stanley Chatterton, Cecil Scott Waine, George Creed and Ernest Williams.[4] The first store was opened on 5 December 1924 in Pitt Street of Sydney's Imperial Arcade, called "Woolworths Stupendous Bargain Basement".[5] Following the first store there were only 29 shareholders and there was little interest to accelerate the brand's growth. However, as trading continued and shareholders brought more capital, the dividends paid by the company increased from 5% to 50% after its third year of operation.

Consumer interest in the company grew after December 1924, as more branches of the store were established across Australia. Woolworths stores began selling a variety of goods, claiming the lowest prices as well as money back guarantees.[6] At the forefront of innovation in Australia, Woolworths stores became the first variety store in the world to install receipt printing cash register machines in 1926.[7]

The second Woolworths outlet was opened on 6 August 1927, on Queen Street, Brisbane.[8] The first Woolworths store in New Zealand was opened in 1929, but the chain has since been rebranded as Countdown which in 2023, the Woolworths - Countdown rebrand was reversed. Following the opening of the Hobart store in 1940, Woolworths had a store in every state in Australia.[9]

With the company and its stores running successfully, Woolworths began to experiment with expanding their grocery rangemore stores began stocking fresh fruits and vegetables and a larger range of food. The first self-service store in Beverly Hills, Sydney was opened in 1955. In 1958 the first supermarket was opened at Dee Why, followed by the first purpose-built supermarket at Warrawong Plaza in 1960.[10] As Woolworths gradually focused more on groceries, the first Big W department store was opened in 1964 at Jesmond, New South Wales.[11]

In 2018, Woolworths Group stopped providing single-use plastic bags during checkout at the same time as Coles Supermarkets, bringing them in line with Australia's third-biggest supermarket, Aldi.[12] In the following three months, Australian's plastic bag use dropped by 80%, leading to 1.5 billion fewer bags going to landfill.[13] Woolworths also committed to removing 180 tonnes of plastic packaging from their products in 2018.[14]

In September 2021, Woolworths launched an online marketplace called Everyday Market. The marketplace allows customers to purchase products from partnered companies, including products not normally sold in the supermarket.[15]

In May 2023, Woolworths acquired Milkrun, a fast grocery delivery startup which ceased operations the previous month and competed with the supermarket's Metro60 delivery service. Woolworths rebranded Metro60 as Milkrun.[16] [17]

Acquisitions

In 1982, Woolworths Limited acquired two Tasmanian grocery brands: Roelf Vos and Purity, which were converted into Woolworths stores in 2000.

In 1958 Woolworths Limited acquired all 32 Brisbane Cash & Carry stores, which was a popular Brisbane grocery store chain. These were then later rebranded as Woolworths stores.[18]

After the arrival of American supermarket giant Safeway in Australia in 1962, Safeway Australia was bought by Woolworths in 1985. Woolworths Limited acquired all of the Safeway stores and the naming rights in exchange for a 20% equity interest in Woolworths Limited.[19] [20] At the time of the acquisition, Safeway had 126 stores across Victoria, Queensland and New South Wales.[21] All Safeway stores in Queensland and New South Wales were rebranded as Woolworths supermarkets, but most Victorian stores continued trading as Safeway.[22] In 2008, Woolworths announced it would rebrand Safeway stores as Woolworths, and this process was completed in June 2017.[23]

Slogan

In 1987, Woolworths launched the "Fresh Food People" campaign after implementing new company protocols for their fresh food departments. The slogan changed slightly in 2012 to "Australia's Fresh Food People" to promote the fact that 96% of fresh produce sold in Woolworths supermarkets is grown in Australia.[24] In 2014 the original "The Fresh Food People" slogan returned with a new lineup of television commercials. Various other catchphrases have been used in recent advertisements, including "That's Today's Fresh Food People", and "Get Your Woolies Worth."

Loyalty schemes

Loyalty schemes include a number of incentives for purchasing at their stores by subsidising petrol prices at Caltex Woolworths petrol stations and the now defunct Woolworths Plus Petrol. Discounts included 2-cent, 4-cent, 6-cent and in some regional areas 10-cent discounts on fuel, rewarded for purchases over certain amounts.

Everyday Rewards

See main article: Everyday Rewards. In September 2007, Woolworths began a trial in central-west New South Wales of Everyday Rewards, a Woolworths shopping card that automatically tracks supermarket purchases and fuel discounts, thus eliminating the need for shoppers to retain paper coupons.[25] In addition it allows Woolworths to record purchases made by customers to offer them relevant promotions and for studies in demographics and marketing,[26] hence incentives for customers who register their details.

In February 2008, following the New South Wales trial, Woolworths announced that its Everyday Rewards card would be rolled out nationally. The implementation began with South Australia and Northern Territory in mid-February 2008, and to other states (excluding Tasmania)[27] by the end of May 2008.[28] In August 2009, Woolworths announced that there were 3.8 million cards registered, of which 1.2 million were linked to a Qantas Frequent Flyer account.[29]

Frequent Shopper Club

The Frequent Shopper Club, stylised as F$C, was a reward program for shopping in Woolworths stores in Tasmania. It was started by Purity Supermarkets in 1992, and was in use until January 2021.[30] [31] In July 2020, Woolworths announced that the program would be folded into the Everyday Rewards program.[32]

Credit card

In 2007, Woolworths announced that it was planning to launch a general purpose credit card in 2008.[33] Woolworths offered these credit card holders reward vouchers redeemable throughout its store network.[34] Woolworths subsequently announced that the Woolworths Everyday Money MasterCard would be launched on 26 August 2008, allowing customers to earn shopping cards redeemable at Woolworths Group retailers.[35] [36]

Private label brands

Woolworths has a range of generic or private label brands:

A budget label covering everyday household products and groceries. Products within this range typically feature a red and white Woolworths logo on the top left corner on the front side of the packaging.[37]

Woolworths' most populous own brand range, it features food lines in all categories across the store. Products in this range feature a green and white logo. Customer can become part of a food sampling group called "Bunch" in order to test foods within this range and provide feedback to make improvements.[38]

This own brand features premium products which are usually only available around Christmas time, and include products such as Christmas puddings, fruit mince pies and cakes.[39]

Macro features a range of foods that are free from artificial sweeteners, colours, flavours, added MSG and hydrogenated oils. Many products in this range are promoted as organic foods.[40] The brand was acquired by Woolworths in 2009, along with nine store leases in New South Wales and Victoria originally intended for use by its Thomas Dux business. As a result of the ceasing of operations of Thomas Dux in 2017 only two of the former Macro Wholefoods sites are still leased by Woolworths, from 2017 being used as Woolworths Metro supermarkets. However, in 2021 one of the sites, in Black Rock, Victoria, was closed and is thought to be being replaced by a BWS or Dan Murphy's liquor outlet. Despite the closure of the sites, the brand is still sold in Woolworths supermarkets today.[41]

This range is a collaboration between Woolworths and Australian personal trainer Michelle Bridges. The range is exclusively chilled and frozen meals, all of which include 2–3 serves of vegetables, grains and protein, and are all under 450 calories per serve.[42]

This is a fresh produce brand which features fruit and vegetables, such as carrots, lemons and apples, that are oddly shaped or are otherwise imperfect. These products are sold at a cheaper price as a compromise to this.[43]

Supermarkets

Sub-brands

Defunct

Controversies

2020 spam marketing

In July 2020, Woolworths were found guilty of breaching spam laws in excess of 5 million times and failing to unsubscribe customers from their mailing lists when requested to do so. The Australian Communications & Media Authority (ACMA) found Woolworths had unlawfully spammed more than a million customers between October 2018 and July 2019.[54] The supermarket was found to have repeatedly ignored consumers who had tried to prevent receipt of marketing emails and had not attempted to improve, despite the AMCA notifying the company that they had received customer complaints. The company was fined $1,003,800.[54]

ACMA chairman Nerida O'Loughlin said of the violation:

"The spam rules have been in place for 17 years and Woolworths is a large and sophisticated organisation. The scale and prolonged nature of the non-compliance is inexcusable."[54]

Wages

In 2019, Woolworths admitted to having underpaid its employees by millions of dollars.[55]

Conversion of full format stores to Woolworths Metro stores

In 2023, Woolworths came under scrutiny for converting some of its full-size stores into the smaller Woolworths Metro format stores. Woolworths Metro stores typically stock a lesser range of products and have a different pricing structure than the full format stores.[56] In August 2023, residents in Alexandria protested the planned conversion of their local Woolworths to a Woolworths Metro. A petition, promoted by local community groups, gathered over 1600 signatures, with support from the City of Sydney mayor, Clover Moore. Despite the community feedback, Woolworths pushed through with the Metro conversion.[57] [58]

Australia Day merchandise

On 10 January 2024, Woolworths Group announced that Woolworths supermarkets and Big W would no longer be stocking Australia Day-themed merchandise, citing declining demand and the broader discussion about the national holiday.[59] The decision caused some controversy, with Liberal opposition leader Peter Dutton calling for a boycott for its decision[60] [61] [62] [63] and vandalism to two stores in Brisbane.[64] [65] [66]

Allegations of price gouging

Both Woolworths and competitor Coles Supermarkets have come under scrutiny in 2023–2024 due to alleged price gouging attributed to the duopoly in the Australian supermarket industry with the supermarket chain claiming this is an ongoing effect of the global 2021–2023 inflation.

CEO Brad Banducci was interviewed on the news program Four Corners in February 2024 and subsequently walked out mid interview but later returned after being coaxed into returning to complete the interview. He subsequently announced his intention to resign from the position in September of that year with the managing director of eCommerce and loyalty, Amanda Bardwell set to replace Banducci as CEO.[67]

See also

Notes and References

  1. Web site: 2022 Annual Report . . 2 February 2023 . August 2022.
  2. Web site: Group Executive Committee . Woolworths Group . 16 February 2021.
  3. Web site: 2020-03-24. Looking beyond the panic-buying, Australia's big supermarket story is Aldi's growing market share. 2021-02-06. Roy Morgan. en.
  4. Web site: The inspiration behind 10 of Australia's iconic brand names . Davidson Branding . 30 April 2018 . Davidson . Grant . 10 December 2019.
  5. Web site: Our Story: 1924 September . https://web.archive.org/web/20150905211646/http://www.woolworths.com.au/wps/wcm/connect/website/woolworths/about+us/our-story/september+1924 . 5 September 2015 . dead . Woolworths Supermarkets . 10 December 2019.
  6. Web site: Our Story: 1924 December . https://web.archive.org/web/20150711101319/http://www.woolworths.com.au/wps/wcm/connect/website/woolworths/about+us/our-story/december+1924 . 11 July 2015 . dead . Woolworths Supermarkets . 10 December 2019.
  7. Web site: Our Story: 1926 Printing Cash Registers . https://web.archive.org/web/20150327034208/http://www.woolworths.com.au/wps/wcm/connect/website/woolworths/about+us/our-story/printing+cash+registers+1926 . 27 March 2015 . dead . Woolworths Supermarkets . 10 December 2019.
  8. Web site: Our History: The Woolworths Story . Woolworths Group . 11 December 2019.
  9. Web site: Our Story: 1940 Woolworths Expands to Tasmania . https://web.archive.org/web/20150330164334/https://www.woolworths.com.au/wps/wcm/connect/website/woolworths/about+us/our-story/tasmania+1940 . 30 March 2015 . dead . Woolworths Supermarkets . 10 December 2019.
  10. Book: Murray, James. The Woolworths Way. A Great Australian Success Story 1924-1999.. Focus Publishing. 1999. 1-875359-540. New South Wales. 103–108.
  11. News: Big W reveals major twist in brand's 50-year history . Wolski . Gilllian . 17 November 2020 . Yahoo Lifestyle . 21 June 2022.
  12. News: Woolworths brings forward plastic bag ban . 4 April 2018 . SBS News . 4 December 2018.
  13. News: We have saved 1.5 billion plastic bags from landfill . News Mail. Khalil . Shireen . 4 December 2018 . 4 December 2018.
  14. Web site: 2018 Annual Report . Woolworths Group . 1 August 2018 . 11 December 2019.
  15. Web site: Blake . Dean . 2021-09-27 . Woolworths' Everyday Market launches nationwide . 2023-03-31 . Inside Retail. en-US.
  16. News: Barrett . Jonathan . 2023-05-25 . Woolworths buys MilkRun with plan to resurrect collapsed fast grocery delivery service . en-GB . The Guardian. 2023-05-25 . 0261-3077.
  17. Web site: Bonyhady . Nick . 2023-05-24 . Milkrun bet it could beat Woolies. Now it's part of it . 2023-05-25 . The Sydney Morning Herald . en.
  18. Web site: 1923 Brisbane Cash and Carry opens - . 11 October 2021 . Australian Food Timeline . 16 September 1920 . en-AU.
  19. https://www.afr.com/companies/retail/the-70-year-battle-that-changed-australian-retailing-20210801-p58eun The 70-year battle that changed Australian retailing
  20. Web site: 1985 Woolworths buys Safeway . Australian Food History Timeline . 10 December 2019 . O'Connell . Jan. 24 September 1980 .
  21. Web site: How Woolworths Started & Grew . 2 November 2007 . 10 December 2019 . Prevor . Jim . Perishable Pundit . 31 . 30 March 2018 . https://web.archive.org/web/20180330075838/http://www.perishablepundit.com/docs/woolworthshistory.pdf . dead .
  22. Web site: Our Story . Woolworths Supermarkets . https://web.archive.org/web/20080913012011/http://www.woolworths.com.au/AboutUs/OurStory/ . 13 September 2008 . dead . 10 December 2019.
  23. News: SmartCompany . 6 June 2017 . 10 December 2019 . Last Safeway shuts up shop... GDP growth at 0.3%... Kogan has plans for NBN market . Dominic . Powell.
  24. Web site: Woolworths unveils fresh 'fresh food' campaign. Inside Retail. en-US. 27 May 2019.
  25. News: . Fuel change on the cards . 20 . 6 September 2007.
  26. Web site: Everyday Rewards Customer Charter . 23 August 2008 . https://web.archive.org/web/20080719030828/http://www.everydayrewards.com.au/CLCS-Web/faces/pages/fixed/customerCharter.jsp . 19 July 2008. dead . Woolworths Everyday Rewards.
  27. Web site: Woolworths . Everyday Rewards terms and conditions . 29 January 2009 . https://web.archive.org/web/20110220143342/https://www.everydayrewards.com.au/wps/portal/rewards/termsandconditions . 20 February 2011 . dead.
  28. News: Woolies revs up discount petrol war . Australian Financial Review . 11 February 2008 . 1, 15.
  29. Web site: Woolworths Limited . Company Results: Full Year ended 28 June 2009 . 1 March 2016 .
  30. News: Tassie misses rewards . https://web.archive.org/web/20120306012128/http://www.themercury.com.au/article/2009/07/18/85321_tasmania-news.html . 6 March 2012 . dead . Smith . Linda . 18 July 2009 . 11 December 2019 . The Mercury.
  31. Web site: Frequent Shopper Club. 2022-02-02. www.frequentshopperclub.com.au.
  32. Web site: Chamberlin . Chris . 2020-07-27 . Woolworths Rewards lands in Tasmania . live . https://web.archive.org/web/20200817074039/https://www.executivetraveller.com/news/woolworths-rewards-tasmania-earn-qantas-points . 2020-08-17 . 2020-08-17 . Executive Traveller . en.
  33. News: Carson . Vanda . 27 August 2007 . Now it's Woolworths the credit card people . The Sydney Morning Herald . 6 June 2007.
  34. News: 30 January 2008 . Retailers take on the banks…again . 1, 61 . Australian Financial Review.
  35. News: 18 August 2008 . Woolworths launches new credit card . news.com.au . 18 August 2008.
  36. Web site: 15 August 2008 . Woolies MasterCard debuts in two weeks . dead . https://web.archive.org/web/20080814214256/http://www.thesheet.com/nl05_news_selected.php?act=2&stream=1&selkey=7022&hlc=2&hlw= . 14 August 2008 . 18 August 2008 . The Sheet.
  37. Web site: Essentials . Woolworths Supermarkets . 27 May 2019.
  38. Web site: Woolworths Food Range . Woolworths Supermarkets . 27 May 2019.
  39. Web site: Gold . Woolworths Supermarkets . 27 May 2019.
  40. Web site: Macro Wholefoods Market . Woolworths Supermarkets . 27 May 2019.
  41. News: Woolies launches Macro brand . Australian Financial Review . Mitchell . Sue . 3 December 2009.
  42. Web site: Delicious Nutritious . Woolworths Supermarkets . 27 May 2019.
  43. Web site: The Odd Bunch . Woolworths Supermarkets . 27 May 2019.
  44. Web site: Countdown to Woolworths. Woolworths Group (Australia). 18 July 2023. 28 August 2023.
  45. Web site: MetroGo shifts into gear as Ampol and Woolworths Metro rebrand convenience stores. Ampol. 17 March 2022. 18 June 2022.
  46. Web site: Ampol Woolworths MetroGo. Woolworths. 18 June 2022.
  47. Web site: Caltex and Woolworths Welcome Customers to The New Age of Convenience. Ampol. 13 November 2019. 19 June 2022.
  48. Web site: ASX Release 2023: Half Year Results Presentation. Ampol. 21 August 2023. 28 August 2023.
  49. Web site: Farewell Flemings Jannali grocery store last to close. Trembath. Murray. 2020-05-08. St George & Sutherland Shire Leader. en. 2020-05-19.
  50. Web site: Inside Retailing. Woolworths to launch new grocery chain. 13 December 2007. 19 December 2007. https://web.archive.org/web/20090420044633/http://www.insideretailing.com.au:80/articles-page.aspx?articleType=ArticleView&articleId=1912. dead. 20 April 2009.
  51. Web site: Woolworths Group to sell Petrol business and enter into commercial alliance with EG Group. Woolworths Group. 9 November 2018. 4 March 2020.
  52. Web site: Annual Report 2013. Woolworths Limited. 21. 1 July 2022. 1 July 2022. https://web.archive.org/web/20220701012500/https://www.woolworthsgroup.com.au/icms_docs/183561_Annual_Report_2013.pdf. dead.
  53. Web site: Company Results Half Year Ended 30 December 2012. Woolworths Limited. 19. 1 July 2022. 14 August 2022. https://web.archive.org/web/20220814153714/https://www.woolworthsgroup.com.au/icms_docs/184187_FY_13_Half_Year_Profit_Presentation.pdf. dead.
  54. Web site: Woolworths hit with record $1 million fine for spamming customers . . 1 July 2020 . 2 July 2020 . Mills Turbet, Hanna.
  55. News: Bonyhady . Nick . Wages ombudsman takes Woolworths to court over underpayments . 2 April 2023 . The Sydney Morning Herald . 18 June 2021 . en.
  56. News: Brook . Benedict . Wages ombudsman takes Woolworths to court over underpayments . 9 November 2023 . news.com.au . 30 June 2023 . en.
  57. Web site: Supermarkets record huge profits as Australians face cost of living crisis . 25 August 2023 .
  58. Web site: Major change coming to some Sydney supermarkets - and not everyone is happy . 29 August 2023 .
  59. News: Antrobus. Blake. 10 January 2024. Woolworths dumps Australia Day merchandise from all stores, cites 'gradual decline' in demand. The Australian. 10 January 2024.
  60. Web site: Dutton's Australia Day boycott of Woolworths blasted as 'culture war' division . 11 January 2024 .
  61. News: Peter Dutton calls for boycott of Woolworths after Australia Day merchandise dropped . The Guardian . 11 January 2024 . Butler . Josh .
  62. News: Dutton wants people to 'boycott Woolworths', but it's not the only company backing away from Australia Day . ABC News . 11 January 2024 .
  63. Web site: Dutton calls for Woolworths boycott after Australia Day merchandise dropped . 11 January 2024 .
  64. News: Two Woolworths stores defaced over Australia Day merchandise. 2024-01-16. 2024-01-16. news.com.au.
  65. News: Second Brisbane Woolworths targeted with graffiti after supermarket announced it would stop selling Australia Day merchandise. 7news. 2024-01-15. 2024-01-16.
  66. News: 2024-01-15 . Brisbane Woolworths store vandalised with graffiti amid Australia Day merchandise controversy . 2024-01-15 . Australian Broadcasting Corporation.
  67. News: Jolly . Nathan . 2024-02-21 . Brad Banducci quits as Woolworths CEO after trainwreck ABC interview . 2024-02-21 . mumbrella.

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