Page 39 - HW April 2020

AUSTRALIA –
STILL OPEN FOR BUSINESS Wesfarmers updated the market on 25 March saying: “At this stage, State and Federal government measures in Australia do not require the closure of retail stores.”
Bunnings, Kmart, Target and O ceworks in Australia would therefore operate “under standard or near-standard trading hours” while operations would continue in the Group’s industrial businesses.
Bunnings MD, Mike Schneider, said: “We know our customers need access to products to maintain their homes and we want to stay open for our customers to make these items available, while also putting measures in place to keep them safe.”
Alongside measures to ramp up in-store hygiene and social distancing and some restrictions on quantities, Bunnings in Australia has also created exclusive weekday shopping hours (pre-09.00) for tradies and health & emergency workers with all other customers able to shop from 09.00-19.00 with weekend trading staying the same for all.
In contrast to Bunnings’ uni ed, corporate approach, the message from Metcash’s independent banners Mitre 10 and Home Timber & Hardware was “contact your local store”.
We’re watching you – Staying with Bunnings, at the end of March the ACCC said it would not oppose the proposed acquisition of Adelaide Tools and Oaklands Mower Centre, having decided the transaction wasn’t “likely to substantially lessen competition”.
Still, warned Chair, Rod Sims, ACCC will be keeping an eye on Wesfarmers’ dominant DIY player: “Anything that further entrenches Bunnings’ position, or attempts to remove current or potential future competitive threats to Bunnings, will be very closely scrutinised.
“ e ACCC’s decision not to oppose this deal should not be read as an indication that the ACCC will take a similar view on future possible acquisitions by Bunnings.
“Expansion into more specialist retailing in particular segments by acquisition of existing competitors, as opposed to organic growth, will be very carefully considered.”
THE UK & EUROPE –
PARTIAL SHUTDOWN
After changing its mind about how best to cope with the pandemic, the UK nally decided on 25 March to mandate the closing of all retail bricks & mortar and for the DIY channel to restrict consumer o erings to essential products.
Homebase and B&Q immediately pivoted to their tried & tested online platforms, o ering contact-less delivery with both reporting immediate surges in demand.
Contact-less for Homebase means “delivered to the rst accessible room in your home, or to an agreed contact-free drop o point”.
For B&Q click & collect would continue with a restricted o ering whereby items would be picked up from an allocated parking zone with product being brought to the customer or their car.
With times becoming tighter still for some already troubled retailers, it was no surprise to hear of “two signi cant retail names in the home enhancement sector” wanting to add a further 90 days to their trading terms!
King sher’s pre-lockdown numbers
– At the request of the FCA, in the days leading up to the shuttering of UK bricks & mortar, B&Q parent company King sher Group – along with other major UK-based companies scheduled to report their FY2019/2020s at end March – delayed its preliminary nancial statements for the year ended 31 January 2020.
Instead, an update was released noting that, although the group’s FY 2019/2020 total sales were negative 0.8% and like
for likes negative 1.5%, the nal quarter saw modest but welcome improvements almost across all territories, with still struggling B&Q the most notable ongoing exception.
For 1 February to 14 March – before any COVID-related store closures – group LFLs rose to +2.3%, excluding the e ect of the leap year impact.
In the third week of March, however, with the impact of the virus kicking in, the UK overall “continued to be positive”, while France was “severely impacted”
by the closure of all stores and Poland experienced “weak footfall and sales”.
Online sales as you’d expect, grew “signi cantly”.
global eyes Pommy plant growers in crisis –
Until lockdown, garden centres in
the UK had been seeing good growth. Indeed as early as January the Garden Centre Association (GCA) was saying it had been “great to see such a positive start to the year with sales up in
the majority of traditional and non- traditional categories”. Overall sales for the month and for the year to date were both +7.7%.
However, come late March, faced with green ngered Brits in lockdown during what would otherwise be their busiest time of the year, the horticultural sector was shouting loud about waste – and that plants, shrubs and trees worth £200 million could be thrown out and hundreds of growers (as many as a third of the total) would be “on the brink of ruin within weeks”.
e Horticultural Trades Association (HTA) – some 650 businesses, employing more than 45,000 workers across the
UK producing ornamental crops –
has therefore been lobbying the UK Government for nancial assistance of up to £250 million to prop the industry up for a time.
Says the HTA: “Due to the plunge in demand following the UK shut down, the value of lost plant sales in the UK will be £687 million by the end of June and
if it continues £1.2 billion by the end of December.”
Successful Kiwi Brett Avery is MD at Farplants in the UK, which grows some 11 million plants per year and is the biggest supplier of ornamental plants into independent garden centres nationwide across the UK.
He says that with around 70% of annual sales made March-June, Farplants is facing “devastating write o s and millions of plants having to be skipped.”
Ironically, on top of all this, millions of green ngered Poms, all with Spring growth top of mind, are being asked to moderate their gardening urges for the time being.
The District Councils’ Network, which represents the 191 District Councils in England responsible for collecting waste, has been calling on homeowners to reduce garden and other waste to help manage “a perfect storm of growing levels of rubbish” thanks to closed recycling centres and on-hold rubbish collections.
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APRIL 2020 | NZHJ 37