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Wesfarmers pleased with Bunnings progress in UK

Published: 13 July 2017 - Fiona Garcia
Bunnings UK & Ireland managing director PJ Davis said Wesfarmers are pleased with the UK venture
Bunnings UK & Ireland managing director PJ Davis said Wesfarmers are pleased with the UK venture

Australian retail giant’s shareholders are “very comfortable” with how the pilot Warehouse stores are performing, says UK & Ireland mamaging director PJ Davis, as he lays out plans for the chain and stresses he “does not see a long-term future for Homebase”.

Following the announcement that Bunnings is doubling its pilot store rollout, with plans to open 16 Warehouse sites by the end of the year, Mr Davis said that Wesfarmers shareholders paid a visit to the UK last month and were pleased with the progress of the venture.

“They are very comfortable with the way the pilot stores are going,” he said, adding that “the reaction from customers has been very positive.” The decision to ramp up the roll out of the Bunnings Warehouse format, from 10 to 20 opening this year, was based on “the precursor that these pilots are successful”.

To date, Bunnings has opened four Warehouse stores of varying sizes, occupying former Homebase sites in St Albans, Hemel Hempstead and now the 90,000sq ft store in Milton Keynes, which Mr Davis described as "the ideal size" for the Warehouse format. To date, all new openings have been former Homebase sites. However, the next pilot is an outlet in Folkestone, which was formerly occupied by B&Q who left the town altogether in January this year. New openings after that will be in Broadstairs in Thanet, Sittingbourne, and Vange in Basildon

The new 90,000sq ft Warehouse in Milton Keynes is the latest pilot store to open
The new 90,000sq ft Warehouse in Milton Keynes is the latest pilot store to open

Mr Davis revealed that Bunnings would also be heading north, although exact locations have not yet been confirmed. He added that not all of the new Warehouses set to open in 2017 would be former Homebase sites and that there would be a new build opening within the next 12 months. “One or two that we are still signing leases on that are outside the Homebase network,” he explained. “As we said from the word go, it will be more than the Homebase network.”

He continued, discussing plans for a new-build store: “It means we can design it completely as we want to.”

While changes are being made in store across the rest of the Homebase chain to fit with the Bunnings retail approach, Mr Davis emphasised Wesfarmers’ strategy that the Homebase name would disappear from the retail landscape in coming years. “As you know we want to cease trading from the Homebase stores within the next three to five years, depending on how departments go,” he said. “We don’t see a long-term future for Homebase and we have to be very upfront about it.

Mr Davis also stressed that the new management team he was putting in place, which includes Wesfarmers' David Haydon, would be instrumental in building Bunnings' "foundations for the future", adding "Damian's no lightweight", referring to former B&Q retail director Damian McGloughlin, who is taking up the post of Bunnings COO in the UK.

Read the full story about Bunnings’ Milton Keynes store and future plans in the July 21 issue of DIY Week.

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