David Jones set to launch upmarket convenience store chain
THE well-heeled residents of Australia's most affluent enclaves are going to have a whole new world of convenience at their feet, thanks to David Jones' latest venture.
As part of its $100 million assault on the premium food sector, the department store chain is planning to open small-format stores in the wealthy suburbs where the bulk of its shoppers live.
Billed as high-end convenience stores, they will measure from 300 to 500 square metres - about the size of a Thomas Dux store - and sell exclusive, premium brands that can't be found at the major supermarkets.
David Jones food group executive Pieter de Wet said the convenience store chain would be unlike anything Australia has seen before.
"We are targeting exactly the same customer who shops at David Jones for their clothes: the top end of the market," Mr de Wet told news.com.au.
"The stand-alone stores will have a very small footprint in suburban locations and be dominated by fresh. That's what our customers want - and if we want to offer them fresh food, we can't expect them to go into the CBD every time. We need to be a bit more convenient."
The venture will draw on extensive market research in Australia, along with observations of similar offerings in the United Kingdom, such as Marks & Spencer.
"Part of the David Jones brand is bringing the best of the world to Australia and the best of local," Mr de Wet said.
And the executives rolling out the smaller format stores - which are yet to have an open date - will be conscious of avoiding a repeat of David Jones' ill-fated attempt at a premium food offering more than a decade ago, or the more recent failure of Woolworths' Thomas Dux.
"Why that didn't work, and why we are going so slowly on the rollout, is that you've got to get your real estate right upfront," Mr de Wet said.
"With Thomas Dux, some stores were really profitable, while some were big-time loss making."
And, he said, "if you're going to have a premium food offering, it has to be differentiated - it can't just be a selection of brands that will be in the supermarkets, because then you've got to compete on price."
To this end, 70 per cent of products on the shelves would be David Jones brand. Interfood, a major international supplier, has come on board in partnership with Yarra Valley farms.
While foodies will have to wait for the convenience stores to open, the department store's revamped food hall at Bondi Junction Westfield will open on August 3, followed by a food market in the Wollongong store. Next up will be Melbourne's Bourke Street Mall store.
The Bondi store would be "quite different to historical David Jones food halls, more contemporary and modern", with celebrity chef Neil Perry helping design its new food offerings, including beef from Tasmania, wine from Canberra and ham from Marrickville's Black Forest.
Olive oils, antipasto and cheese, cakes and sweet snacks will be on offer, and the food hall will have an oyster bar with a wide selection of wines, a butcher as well as pre-wrapped meat for the grab-and-go shopper.
Pre-cut vegetables, marinated meats and pasta sauces will be on offer for those who want to have a meal ready within 15 minutes of getting home.
The Bondi food hall will be equally split between food service and retail, while the smaller Wollongong food hall with have a bigger retail section.
Mr de Wet said that David Jones parent company Woolworths (of South Africa, no relation to the Australian supermarket) had not initially planned on entering the food market.
"We didn't buy David Jones with the intention of building a food business, but after the acquisition we saw an opportunity at the top end of the market," he said.
"For the first six months, we did a lot of research - and I'm glad we did. We didn't quite appreciate the Australian consumer at first; They buy food differently and eat differently than in the United Kingdom and South Africa."
He said the existence of "two strong and very powerful supermarkets" made Australia different from overseas markets, with customers used to "world class" food service and turning their noses up at packaged meals, which they equated to "lower quality".