Coles and Woolworths convenience store battle

Posted by AFN Staff Writers on 3rd February 2012

While Australian Food News yesterday reported the strong performance of Coles fresh produce division, the quarterly figures reported by parent company Wesfarmers show that Coles Express non-fuel sales declined by 1.4 percent for the quarter compared with Woolworths positive 4.9 percent increase from the previous year.

Meanwhile Coles’ fuel sales for the second quarter ended December 31, 2011, were $2.1 billion, an increase of 16.3 percent on the previous corresponding period.

Coles’ Ian Mcleod said, “The value investment in fuel remained popular with customers, resulting in record levels of shopping docket redemptions at Coles Express. This contributed to 2.5 percent growth in comparable fuel volumes during the quarter and 3.7 percent growth for the first half”.

Woolworths’ competition in fuel sales remained head-to-head with Coles, with 13.7 increase percent for the half year, and 13.4 percent for the second quarter. Comparable volumes decreased by 0.4 percent for the half year and only decreased by 0.2 percent for the second quarter.

However, Coles Express convenience store non-fuel sales struggled, growing by 0.7 percent for the first quarter and 1.2 percent in the first half. Comparable sales declined 1.4 percent in the second quarter and 0.5 percent in the first half, as a result of lower discretionary spending by customers.

By contrast, Woolworths’ convenience Safeway stores’ total merchandise non-fuel sales were up 4.9 percent from the previous quarter, while sales were up 4.0 percent, year on year compared with the previous year.

The Coles Express network operates 625 sites across Australia. Comparatively, 7-Eleven operates approximately 600 stores on Australia’s eastern seaboard including about 200 acquired Mobil/Quix sites. Woolworths’ Safeway operates 591 Australian convenience stores, including 132 Woolworths/Caltex alliance stores.