Coles Scraps Super Kmart Stores

Sydney Morning Herald

Friday May 12, 1989

By LEA WRIGHT, Marketing Writer

Coles Myer Ltd has abandoned the hypermarket concept - begun in the early 1980s under the Super Kmart name where shoppers could purchase anything from electrical goods to a bottle of tomato sauce.

As part of a dramatic restructuring of Australia's largest and most powerful retail group, the name and the concept have been wiped out. The Super Kmart operations will be split into two separate retail trading components - a standard Kmart store and a Coles' New World supermarket. The move, announced yesterday, marks the end of Coles' attempt to bring hypermarkets - combined supermarkets and discount department stores - to Australia.

The scrapping of Coles Super Kmart follows the recent divestment of the company's speciality footwear business and the decision to divide many management functions between Coles' two department stores, Myer and Grace Bros.

Despite the move away from the hypermarket retail concept, Coles Myer's chairman and chief executive, Mr Brian Quinn, said that Coles Myer remained committed to the "one-stop shopping" retail concept but said that after a detailed examination of the cost/benefits of Super Kmart, it had been decided the development of a separate management structure could not be justified.

He said: "Our Super Kmart store sites are, in the main, extremely well located and (in the transition) will continue to generate increasing sales and profits for the company.

"The economies of scale that will be achieved by the direct link to Kmart and Coles New World will be reflected in considerable cost savings.

"Circumstances have changed significantly since the Super Kmart concept was introduced in 1982 and, although some short-term costs will be incurred, we are confident that the long-term future of these stores and the achievement of maximum sales and profits will be guaranteed by their inclusion our mainstream retail networks."

Mr Quinn also announced a series of major executive changes.

They included the surprise creation of a new position for the former managing director of Grace Bros, Mr Bob Dalziel, who takes up the role as director of planning and development.

Mr Russell Stucki becomes chief executive officer food and liquor retailing, in addition to being managing director of Coles New World, while Mr Geoff Sadler has been appointed director retail operations for Coles New World.

© 1989 Sydney Morning Herald

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