Woolworths to rival Bunnings in Retail Hardware Sector
Woolworths to enter $24 billion hardware sector
− Grows local independent retail hardware sector via acquisition of Danks
− Launches destination home improvement store network
− Announces JV with leading US home improvement retailer Lowe’s
The Board of Woolworths Limited (Woolworths) has approved plans for the company to enter the $24 billion plus hardware sector with a multi format strategy designed to meet the everyday home improvement needs of Australian consumers.
First Coles and Woolworths compete in the supermarket aisles. Then the competition moved further into the bottle shop, and also service station sector. Now they will compete again in Retail Hardware sector or home improvement sector.
This fresh new home improvement offer will be based on a combination of significant local and international industry expertise, the right range representing value and choice; and a mix of convenient traditional hardware store formats and large destination home improvement stores to broaden consumer choice.
Woolworths today announces:
- A recommended takeover offer for Danks Holdings Limited (Danks), Australia’s second largest hardware distributor supplying 583 Home Timber & Hardware, Thrifty-Link Hardware, and Plants Plus Garden Centre stores plus 939 independent hardware stores
- The development of a network of destination home improvement stores with a target to secure more than 150 store sites within the next five years.
- A joint venture equity agreement with leading US Home Improvement retailer Lowe’s Companies Inc (Lowe’s)
Through successful category expansion in the past, Woolies is now proudly represented in consumer electronics, liquor, and hotels and has also entered financial services with the Woolworths credit card Everyday Money. The opportunity to grow the business by entering new categories benefits woolsworth shareholders by diversifying revenue streams and providing access to a new demographic of customers through which to grow the business and enhance shareholder value.
Danks is a successful distributor to more than 1500 independent retailers, of whom 583 are branded either Home Timber & Hardware (205), Thrifty Link (312) or Plants Plus Garden Centres (66). Wollworths believes there is a clear opportunity to grow the distribution business and deliver greater efficiencies to independent retailers. Supporting independent retailers will continue to be a key priority for Danks.