Wesfarmers has recorded $4 billion in online sales after improving its ecommerce capabilities and omnichannel offers.
In the retail giant’s 2022 financial results, the company said it recorded more than 100 million online website visits per month.
Wesfarmers managing director Rob Scott said its financial year “was the most disruptive period we've experienced through the pandemic” however, it provided an opportunity to “demonstrate our commitment to our core objective”.
Scott said Wesfarmers reported the company has taken advantage of “opportunities arising from the digitisation and decarbonisation of the economy” in recent years.
He said over the year Wesfarmers continues to renew “the portfolio and invest in our existing businesses, creating new platforms for value creation” including the introduction of OneDigital.
“We've continued to strengthen our data analytics capabilities at a divisional level and through our shared data platform, OneData,” a subset of its established digital division OneDigital.
“We continue to develop our omnichannel offer, optimising and expanding store networks and developing deeper digital engagement with customers.
“We've made investments to modernise and digitise our supply chain and fulfillment capabilities.”
Over the year Scott added Wesfarmers also finalised the acquisition of the Australian Pharmaceutical Industries [API] and which also lay the foundation business for its new health division.
Scott said development Scott said development “did not slow down” in any of its retail brainds, so they all reported “good progress on their strategic agendas”.
Bunnings
Throughout the year Wesfarmers “continued investment being made to strengthen Bunnings customer offer.
“This included the ongoing expansion of data digital capabilities, which are driving greater personalization and digitization across both DIY and commercial customers.”
Its revenue increased 5.2 percent to $17.8 billion for the year.
The company cited new in-store technology and layout changes to create an easier Bunnings experience and allowed staff to better assist customers, while a new web platform and improved search function provided improvements for customers shopping online.
Kmart Group
The Kmart Group (Kmart, Target and Catch) pulled in strong results despite lockdowns in parts of Australia “with ongoing ... digitisation initiatives in its stores and through the supply chain.”
“Kmart also continued to leverage its product development capabilities, to bring new products to market and to enter new categories in-store and online,” said Scott.
Both Kmart and Target joined OnePass during the year “which strengthens the value and convenience of their offers and this has been well received by customers.”
Meanwhile, Catch growth was pleasing but earnings were “below our expectations”.
“Catch continues to invest in marketing technology and supply chain capabilities to support its long-term scale aspirations,” said Scott.
Scott called the opening the new Catch fulfilment centre “an important milestone”. It began fulfilling customer orders in May 2022.
Catch also transitioned to the new OneDigital division this past July.
Kmart Group’s revenue decreased by 3.5 percent to $9.6 billion for the 2022 financial year.
Officeworks
Speaking on Officeworks Scott said the brand “delivered strong growth in technology sales during the year”, however this was offset by “other categories where sales were more negatively affected by lockdowns and temporary store closures.”
Its earnings result echoes Wesfarmers continued investment in data and digital capabilities plus the launch of new products and services during the year.
“Officeworks completed the transition to its new customer fulfilment centre in Victoria, which further strengths and strengthens its omnichannel capabilities and drives increased efficiencies,” said Scott.
Officeworks’ revenue increased 4.6 percent for the year to nearly $3.2 billion. Earnings of $181 million were 14.6 percent lower than the prior year.
OneDigital
In the second half of its financial year, Wesfarmers formed a digital and digital development team, OneDigital, combining its digital businesses, including the OnePass membership program and the Group shared data asset, OneData.
Scott said Wesfarmers will “continue to develop the shared data asset which will provide the retail divisions with a single view of the customer and unlock additional operating efficiencies across the group.”
This past July, Catch moved from Kmart Group into OneDigital and will be led by Brendan Sweeney as managing director of Catch this October.
Operating expenditure relating to OneDigital of $80 million spent across the year. These costs included costs associated with OneData (formerly the Advanced Analytics Centre) and the development of the OnePass membership program.
Wesfarmers plan to continue to accelerate OneDigital development with the OnePass membership program to extend partnerships to Bunnings and Officeworks in the 2023 financial year.
Wesfarmers recorded $36.8 billion in revenue, up 8.5 percent year-over-year and a gross capital expenditure of $1.1 billion, up 27.7 percent from the prior year, partly driven by increased data and digital investment.
Over the 2023 financial year, net capital expenditure of $1 billion to $1.25 billion is expected.
Wesfarmers reported a statutory net profit after tax (NPAT) of nearly $2.4 billion for the full year ended 30 June 2022.
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