Wesfarmers applies whip to Coles IT


Coles parent Wesfarmers today said it was “driving” the re-development of the supermarket chain’s supply chain and associated IT systems “harder” as it rolled out automatic stock replenishment systems across the nation.

At his company’s half-yearly financial results briefing today, Wesfarmers chief executive Richard Goyder said the auto-replenishment system had been rolled out to 44 stores and was on track to hot a total of 200 stores by the end of the company’s financial year in mid-2010.

In a slide entitled “Driving Coles supply chain & IT harder”, the company said the rollout had already resulted in reduced lead times from distribution centres to stores.

However, Goyder said the ‘Easy ordering’ replenishment platform, which he described as the interface between Coles’ systems and its supply chain as being rollout out in a very careful way.

“[Coles chief executive] Ian McLeod and the team have been very careful to ensure we get it right,” he said. “But as we get it right, we’re seeing benefits through the stores and supply chain.”

The company has also rolled out its self-scan checkout systems in nearly 70 stores so far, although it did not say how many more were planned. Coles has approximately 700 stores at the moment.

The speed of the roll-out may surprise a few, because in August last year, Goyder had said that McLeod had not believed the company was capable of introducing auto-replenishment at that point.

Coles’ back-end IT upgrade of its supply chain systems has long been seen by the retail industry as a critical piece of the puzzle in the supermarket chain’s struggle to match the success of long-time rival Woolworths.

Woolies’ development of its AutoStockR and StockSmart systems in the years after the appointment of the company’s then-chief executive officer Roger Corbett. The executive is credited with using the stock systems to take massive costs out of the company’s bottom line while delivering fresher supplies in a more efficient manner to customers.

Image credit: Agata Urbaniak, royalty free


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