What’s Woolies Worth? Is their market that “SUPER”?

In the ever increasing world of the “Do It Yourself”  markets, and trade orientated supply chains, has Woolworth’s bitten off more than they can chew?

Within the  traditional Australian market, the main competitor that Woolworth’s had was the  Westfarmer’s group. On paper the two look similar in the way they offer their products.

One thing was missing for Woolworth’s. A hardware chain.

Woolworth’s  as a group of companies has a great diverse range of product offerings to the market place, that caters for multiple segments .  Their portfolio speaks for itself. To compete with Coles, part of Westfarmers, Woolworth’s needed to add a “Big Box” supply chain to compete with their main rival. Bunnings!

The home improvement market within Australia is worth over $40 billion a year. It’s one of the few retail segments that has been posting consistently strong growth in recent years.

But have they researched how best to capture that market?

They would of looked at the customer. Step 1 of the 5 C’s.

This would incorporate the home owner, the weekend warrior, the plumber, the carpenter, the gardener and maybe the “jack of all” trades?

Enter Master’s.


Woolworth’s partnered up with the second largest hardware chain in the USA. Lowes, who had a 30% stake in the venture.

Lowes store growth from the 1980’s, of 300 stores to 1234 stores across 49 states by  late 2007 , shows that this strategy looked like a good fit for Woolworth’s.

From 2011 up until June 2015 the Woolworth’s/Masters stores grew to have 58 stores. Original plans were to open 160 nationally.

What’s missing?

They looked to partner with a company that isn’t well known within the Australian market. Did they do themselves justice by partnering up with an unknown entity within the Australian market? Were there better options?

When Woolworth’s released that they were entering the hardware sector, they gave their competitors too much room to re assess ‘their’ current market and realign the research tools needed to counteract the new threat.

 Woolworth’s, with the introduction of Master’s were behind the leaders, and missing the best locations available – an error compounded by its rush to roll-out stores.

What this did do, was allow Westfarmers to look at optimal sites, within the same geographical  area of Woolworth’s  and create a like for like experience that the Woolworth’s – Masters brand were looking to target.

There was also  5 key points that Masters failed to address when going head to head in a market that they didn’t have traction in.

  1. Poor Strategy
  2. Wrong Locations
  3. Wrong Product Mix
  4. Work Place Culture was wrong
  5. The Experience

Even one of the key members of Woolworth’s was quoted as saying –

A retailer can choose quality sites, good value sites, or do it fast — but no one can do all three at once

Home Improvement managing director Matt Tyson

 Partnering with Lowes.  In the USA they are the second biggest hardware brand behind COSTCO. The other well known name within the US market is WALMART.  Should these of been options to partner with?
If you look at the tag line that Lowes has – “Improving Home Improvement”. It offers up  to consumers that  Lowes are about making good better. The Masters Home Improvement slogan gave the consumers something different.
“Don’t you just love competition?”  Is this a statement or question?
Walmart has – Always Low Prices, it gives the consumer a perception of value. This tag line has been strong for 19 years, and has now been updated and replaced with – “Save Money. Live Better.” 

If Woolworth’s wanted to go head to head with Bunnings, then they needed to match the qualitative aspects that consumers perceived through Bunnings.

 One Bunnings store (Melbourne region), developed a new site on a corner lot, right in front of the Masters store. So when the consumer is looking for the hardware store, What do they see first?
Taking in all the data!
When looking at entering into the hardware sector from scratch, did Woolworth’s take heed of advise from industry experts?
Despite their best efforts to compete, Masters wasn’t working out as planned. Which prompted analysts such as Merrill Lynch’s well-regarded retail watcher David Errington to call for Woolies to abandon it at birth.
So it seems that for all the best efforts to capture a large chunk of the hardware market, Woolworth’s has not only put the cart before the horse, but did so with blinkers on!
 Image result for going through life with blinkers on
 They became so focused on one competitor, Bunnings.
Image result for bunnings
 But did they research the other players that would react to the threat?

Image result for harvey norman logo Image result for the good guys

Image result for mitre 10

Its fair to say that Woolworth’s wanted to be “Jack of all Trades”, but became “Master’s” of none!


Morgan Cornelius – ID: 214366259










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