Coles reported supermarket sales revenue of $39.0 billion in FY2024, up 6.2% on the prior year (normalised: 4.3%).
The retailer says sales revenue growth was driven by a positive customer response to its ‘Great Value, Hands Down’ seasonal value campaigns, well executed continuity and collectibles programs and trade events such as Christmas, Easter and Mother’s Day, strong growth in eCommerce and improvements in availability.
“This year marks 110 years since our first store opened in Smith Street, Collingwood, Victoria,” said Coles Group Chairman James Graham.
“Ever since that time, we have been focused on providing great value, quality groceries and essentials to our customers.
“Our progress over this last year reflects the continuation of this commitment – working with our team, suppliers and partners to efficiently deliver fresh food, groceries, household items and liquor across our network of more than 1,800 retail outlets, serving customers nearly 18 million times a week,” Mr James said.
Products and pricing
Coles delivered value to customers through its seasonal value campaigns, with price investments made in key categories such as meat, vegetables and pantry staples, and thousands of weekly specials and every day low prices.
“The financial pressures on households and families have been front of mind for us this year and we have endeavoured to deliver value across our supermarket, liquor and online offerings to help customers balance the household budget,” said Coles Group CEO Leah Weckert.
Exclusive to Coles sales revenue increased by 8.6% (normalised: 6.6%) to $13.5 billion with the portfolio continuing to resonate with customers seeking value. The Coles Finest range delivered particularly strong sales growth of 20.4% (normalised) and convenience meals, such as the Coles Kitchen range, also grew strongly with customers seeking quality alternatives to eating out and convenient meal solutions.
The Coles Simply value range was launched in the first quarter with distinctive yellow packaging to help customers easily identify key own brand value items and grew to more than 100 products by year end. Coles says this range has achieved strong brand awareness and volume growth over the year.
eCommerce
eCommerce sales grew by 30.1% (normalised) and penetration increased to 9.4%. Coles says online sales growth was driven by improvements in customer experience, availability and strong trade across key events including Black Friday, Christmas, Easter and the Coles Online 25th birthday sale.
Online NPS increased by 22.1% with growth in key metrics including availability, range, Click & Collect wait times and ease of check out. Significant digital enhancements were rolled out across the Coles App and website to improve and personalise the customer experience.
Coles also made improvements to its Rapid and Same Day delivery offers and launched Coles Plus Saver, a monthly subscription offering customers 10% off one shop in-store or online each month, as well as additional benefits.
The retailer says efficiency initiatives drove improved profitability, including a reduction in call centre costs and store pick productivity.
Distribution and fulfilment updates
During the year, ramp up of the Redbank automated distribution centre (ADC) was completed with Redbank now servicing 219 stores in Queensland (Qld) and northern New South Wales (NSW).
Construction and commissioning of Coles’ second ADC in Kemps Creek, NSW, was also completed with the first inbound deliveries received as part of the commissioning and testing process in March and the first outbound deliveries to stores commencing in July.
Following ramp up, the Kemps Creek ADC will service 229 stores across NSW and the ACT.
In July 2024, Coles successfully commenced operations at both the Wetherill Park NSW customer fulfilment centre (CFC) and the Truganina (Vic) CFC. These facilities will service next day home delivery orders across metropolitan Sydney and Melbourne and are anticipated to deliver a significant improvement in customer experience and a differentiated home delivery offer in the two cities, including:
- Industry leading perfect order rates.
- Improved freshness.
- Expanded product range.
- Increased agility in trialling new products.
These facilities will also significantly expand network capacity, with the potential to add the equivalent store capacity of approximately 40 new supermarkets over time.
Next day home delivery orders from stores in metropolitan Melbourne and Sydney are expected to be transitioned to the CFCs by the end of December.
Network growth
During the year, Coles completed 50 store renewals, including 20 Format A and three Coles Local stores. Coles also opened 12 new stores and closed two stores, taking the total network to 856 supermarkets.
Looking ahead, Ms Weckert, said Coles Group is well positioned to deliver on its strategic priorities.
“With our Kemps Creek ADC ramping up and our two automated CFCs in the process of transitioning orders from stores, we look forward to unlocking the full benefits of our transformation investments, including delivering further improvements in availability and efficiency through our ADCs and delivering a world-class customer experience for online orders,” she said.
“With ongoing cost-of-living pressures, we will also continue responding to the needs of our customers with a focus on value through every day low prices, promotions, Flybuys and Coles Own Brand.”