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Coles

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Submitted By manualdaniel
Words 5776
Pages 24
All about

2011

Contents
About us .........................................................................................1
The Coles story .......................................................................... 2
About Wesfarmers ...................................................................4
Our year ........................................................................................5
Our new format stores ...........................................................8
Our team ......................................................................................9
Responsible sourcing ............................................................10
Australia first ............................................................................ 12
Our sustainability ................................................................... 13
Our community ....................................................................... 14
Our 3 year performance summary ..................................17
Cover image: supplier to Coles for over 20 years, apple grower
Harvey Giblett of Newton Brothers Orchards, located in Manjimup,
Western Australia.

About us
Coles is a leading national food, liquor and convenience retailer in Australia. We employ more than 102,000 team members across our brands, which include Coles and Bi-Lo supermarkets,
Coles Express, 1st Choice Liquor Superstore, Liquorland, Vintage Cellars and Spirit Hotels.

Our goal

What we want to achieve

“To give the people of Australia a shop they trust, delivering quality, service and value.”

Our values

What we believe in

Our customers come first – always!
We support each other to get things done.

Our circle for success

Our ways of working

Our six point plan to deliver our goal

How we work together

Lead effectively
Act collectively
Support consistently

We take pride in the service we provide.

Motivate universally

We constantly strive to do better.

Care passionately

All about Coles 2011

1

The Coles story
Coles has grown from humble beginnings in 1914 when the first Coles variety store opened in Collingwood, Victoria.
Today Coles is a national icon, an innovator and a key part of the Wesfarmers Group.

In the beginning
1914

A decade of firsts
1960

• The first Coles variety store opened in the working class suburb of Collingwood, Victoria.
It was founded by brothers
George (GJ) and Jim Coles and its catch-cry became ‘Nothing over 2/6’.

• First Coles-Dickins supermarket opens in North Balwyn, Victoria.

1962
• First Coles New World supermarket opens in Frankston, Victoria.

• Coles proprietary company acquires several liquor companies, including Liquorland, Claude Fay Cellars in NSW and Mac The Slasher in Tasmania.

1985

1986

1919 – 1924

• Name of the company officially changes to Coles Myer Ltd., and a new corporate symbol is adopted.

• GJ’s other brothers Edgar,
Kenneth and Norman Coles join the business.

1991

• The proprietary company
GJ Coles & Co Pty Ltd. is formed.

• Coles New World renamed Coles Supermarkets.

1993

1927
1969

• GJ Coles & Co floats on the
Melbourne Stock Exchange.

• First Kmart discount department store opens in outer suburban
Burwood, Victoria, following Coles’ partnership with America’s S.S. Kresge.

GJ Coles

All
All about Coles 2011

1981

• Coles acquires Myer Emporium Ltd., including Grace Bros, Target, Fosseys,
Country Road and Red Rooster.

• Brother Arthur Coles joins the business.

2

The acquisition trail

• Coles Myer launches new businesses, such as World 4 Kids and Officeworks.

1999
• Harris Technology acquired.

To fuel and liquor and beyond
2003
• Coles Myer acquires the retail business of Shell
Australia and forms Coles Express to sell fuel and convenience items.

2005
• Coles Myer opens a 1st Choice Liquor
Superstore in Tooronga, Victoria.

2006-07
• Coles sells Myer and the company becomes
Coles Group Limited.

Coles joins Wesfarmers
2007
• Wesfarmers acquires Coles Group for $20 billion
– the largest takeover in Australian history.

2008
Coles turnaround commences.

2011
• Coles achieves nine consecutive quarters of industry out-performance.

• Coles expands into hotels in Queensland, buying Hedley Hotels and Talbot Group Hotels.

All about Coles 2011

3

About Wesfarmers
In November 2007, Coles was acquired by Wesfarmers Limited. Based in Perth, Western
Australia, Wesfarmers has grown and diversified from its early beginnings as a farmers’ cooperative to become one of Australia’s largest listed companies with almost 200,000 employees and approximately 500,000 shareholders.
Today, Wesfarmers’ operations include: supermarkets, department stores, home improvement and office supplies, coal mining, insurance, chemicals, energy and fertilisers, and industrial and safety products.
Wesfarmers primary objective is to provide a satisfactory return to its shareholders.
The company aims to achieve this by:


satisfying the needs of customers through the provision of goods and services on a competitive and professional basis;



responding to the attitudes and expectations of the communities in which the company operates;



providing a safe and fulfilling working environment for employees, rewarding good performance and providing opportunities for advancement;



placing a strong emphasis on protection of the environment; and •

acting with integrity and honesty in dealings both inside and outside the company.



4

contributing to the growth and prosperity of the countries in which it operates by conducting existing operations in an efficient manner and by seeking out opportunities for expansion;

All about Coles 2011

www.wesfarmers.com.au

Coles food & liquo r sales growth versus industry gr owth Our year

Industry
Coles

In June 2011, we completed the third year of our five year turnaround plan ‘to give the people of Australia a shop they trust, delivering quality, service and value’.
“Our strong 2011 performance confirms that the Coles turnaround remains on track and we’ve now outperformed our competitors for the ninth consecutive quarter. These results reflect the hard work and dedication of our team. Our supermarkets are performing strongly with our renewed focus on fresh food, ‘Down, Down’ and new format stores striking a chord with our customers and lifting overall customer numbers and sales. We will continue to refine and grow our store network in both our supermarket and liquor businesses, focusing on larger format stores with higher sales. Coles Express was our quiet achiever of the year, performing strongly to grow revenue by 8.7% to nearly $6.8 billion and profits up 23% to $95 million.

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In the coming year, we will continue to improve our fresh food offer, enhance our customers’ experience and further progress the rollout of new store formats, building on our current momentum and providing better service, quality and value. I am confident we can do so, given the terrific commitment from our team members.
I look forward to our continued success in the year ahead.”

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All about Coles 2011

5

Better value
Quality food costs less at Coles and since
January 2011 we have saved Australian shoppers more than $800 million by keeping prices down. During the year we launched our ‘Down, Down’ campaign and reduced the prices of over 6,000 products by an average of 10%.
In reducing the price of some staple items, like milk, we recognise we need to support our farmers and ensure our lower prices don’t result in less farm income. That’s why ahead of lowering the price of milk, we increased the price we pay to milk processors and fully funded the price cut from our profit margin.
As well as offering our customers better prices, we engaged customers with creative and value for money recipe ideas, through our ‘Feed your Family’ campaign, and showcased our ever improving fresh food quality through our ‘MasterChef’ sponsorship. Quality you can trust

Our awards

Our promise is ‘if you are not 100% satisfied, let us know and we will happily give you a full refund or replacement’ so we’re confident that our range is as good as anything else on the market.

During the year, many of our products received awards for quality and excellence.
Here’s a taste of a few...

During the year, we launched more than 1,000 Coles Brand products thanks to our team of product development experts and quality technologists, and received 30 product quality awards for
Coles Brand and Coles Finest products.

At the 2011 Royal Queensland Food & Wine Show, 10 Coles products were awarded silver, including Coles Finest Angus Beef Porterhouse
Fillet steak in the ‘Branded Beef and Lamb’ category and nine products across the ‘Cheese and Dairy Produce’ and ‘Ice Cream,
Gelato and Sorbet’ categories.

All our products undergo rigorous testing to ensure great taste, great value and nutrition.
We also double check this by conducting taste testing with the wider community.

Our brands
Coles Finest represents premium flavour, aroma, texture and enjoyment, and we know industry experts agree!
Coles Brand represents by far our biggest range of
Coles products, offering great quality and value for the core essentials of our customers’ weekly shop.
Coles Smart Buy represents a great value offer for the budget conscious.
Coles Organic and Coles Green Choice are two product ranges that are better for the environment. Coles Organic range are certified organic and display the Australian
Certified Organic logo. Coles Green
Choice laundry and cleaning range are formulated without the use of hazardous chemicals and are biodegradable.

6

All about Coles 2011

Coles Carisma Potatoes
Coles Carisma, a new potato launched in 2010, took out the Marketing Award at the AUSVEG National Awards of
Excellence. Coles Carisma is the only potato in Australia to carry the official low glycemic index (GI) symbol from the
Glycemic Index Foundation.

Tell Coles
As part of continuing to improve our business, we regularly ask our customers to tell us about their shopping experience.
Tell Coles provides us with vital feedback about their supermarket shopping experience and our product range. During the year, all stores participated in the program and over 160,000 survey responses were received including over 112,000 customer compliments about our team members and customer service.

Market-style shopping
We continued to upgrade and build new stores during the year, adding 94 new format supermarkets and bringing the total number of new format stores to 144.
Our new stores feature a market-style fresh produce area, open butcher, baker, seafood and cheese shop. Aisles are wider to make it easier for shoppers to move around and the large open entrances are more welcoming.

tell

Convenient self-checkouts
We’re also embracing the latest and greatest technology for those shoppers who are happy to look after their own purchases and have now installed over 650 self-scan checkouts in more than 100 stores.

Shop online
Our online shopping service at coles.com.au expanded during the year. It is now available to 85% of Australians across all states and territories, including remote regions in the Top End. Around 20,000 product lines are available including grocery, fresh produce, bakery, meat and deli items. During the year, we made this service even more flexible for our busy customers who can enjoy the convenience of ordering online and collecting their shopping from one of our selected stores at a time that suits them.

New services
In June 2011, Drive Magazine ranked Coles Car Insurance the best priced out of 18 insurers. As well as providing car insurance that’s great value, new policyholders can triple their standard 4 cent fuel discount once a month for a year and in March 2011, we added Coles
Roadside Assistance to our insurance offer.

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All about Coles 2011

7

Our new format stores
Our new format supermarkets feature fresh produce on ice for maximum freshness, instore butcher to cut meat upon request, freshly baked bread, seafood counter and a gourmet cheese shop.

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Coles Eden Rise – our largest store at 4,600 square metres in Berwick,
Victoria, opened in October
2010 with an expanded range of products, such as mobile phones, electronics, homewares, apparel, stationery, outdoor needs and groceries. Our team

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• 93.4% work gistics and 6.6% in lo ort and store supp

As we undertake one of the biggest business transformations in Australian retail history, it’s important we attract and retain passionate team members that care about our customers each and every day.

424 team members who identify themselves as being
Indigenous Australians.

experience and going above and beyond for our customers.
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Cole s Coles Express – Site Manager Rebecca Davies and the team at
Coles Express Mordialloc, Victoria, took out the award for the Shell
‘Smiling Stars Country Retailer 2010’. This annual award is given to the top Australian site.

To ensure we represent and embrace Australia’s diverse population, we launched our Aboriginal and Torres Strait Islander Plan and in
May 2011 supported National Reconciliation Week, holding our first
Dreamtime Event at our Store Support Centre in Tooronga, Victoria.
2009

25

Vintage Cellars – our Vintage Cellars store in Hunters Hill, New
South Wales was awarded the Top New South Wales Liquor Store of the year at the Retail Liquor Industry Awards for Excellence in
2010
November 2010.
2011
Coles Rockhampton – in September 2010, Mark Scarcia, from Coles
Rockhampton, Queensland, won the Employment Award at the
Excellence in Action Awards for Disability Week. Mark has worked with Coles for eight years, currently in the grocery department.

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As part of our Plan, we are planning further pilot employment programs across Australia and hiring employment coordinators in far north
Queensland, New South Wales, Australian
Capital Territory and Northern Territory to assist Indigenous team members with their transition into employment. More than
100 Coles team members have completed cross-cultural awareness training to better understand and respect Aboriginal culture.

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173 countries of origin;

Over the past year, our training programs have focused on lifting our leadership capability and effectiveness across the business. Since launching our Retail Leaders and
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In November 2010, Coles was presented with the ‘Business Award –
Large Business Focus’ at the National Disability Awards in Canberra.
Since forming a partnership with Disability Works Australia in 2004, an agency that facilitates employment of people with a disability, we have employed more than 2,400 team members with a disability.

2,97

In June 2011, we conducted our annual ‘Face of Coles’ survey to provide an insight into the profile and diversity of our workforce.
Over 70,000 team members participated and shared information about their age, cultural background, ability, education levels and carer commitments. From the survey we know there are:

Awards

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The Face of Coles

9

Responsible sourcing
As well as having great products at affordable prices, customers want us to know where their food comes from and that it’s produced in a way that’s kind to animals and the environment. During the year, we made some great strides to meet customer demand in these sensitive areas. Here’s some of what we achieved.
Sow stall free pork

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Following our announcement in ork July 2010 that we would phase out sow stall produced fresh pork from the Coles Brand range by 2014, we extended our commitment to include hams and bacon made from local and imported pork. During the year, we commenced auditing potential sow stall free farms in
South Australia and Victoria against our new pork welfare policy.

Good Egg Award
In December 2010, we were proud to receive a Good Egg
Award from the RSPCA for announcing we would no longer sell cage eggs from 2013. At the same time and to help customers switch from cage eggs to free range eggs, we cut the price of Coles Brand free range eggs by at least 18%, after our research showed that 95% of customers would switch to free range if the price was lower.

Phosphate free
As part of ensuring we do what we can to ensure our products are kind to the environment, all Coles Brand laundry detergents will be phosphate free by the end of 2012. Following the move, our laundry products will continue to be great quality, provide excellent value and meet our customers’ expectations when it comes to the environment.

RSPCA Approved
Chicken
We launched an RSPCA approved range of chicken products in April 2011. The new range has been sourced from
Bendigo Valley chicken and is available in Victoria, Tasmania and
South Australia. RSPCA Approved Bendigo Valley chickens are raised in spacious barns with ample room to move, and have improved lighting conditions. The range is the fourth RSPCA approved product we have launched, following pork, turkey and barn-laid eggs.
10

All
All about Coles 2011

d, urwoo . oles B es r at C ood choic nte d cou med seaf r eafoo able s make info n s ustai The s customer helps In March 2011, we announced a m with three-year progra leading WWF-Australia, a ries authority on fishe review sustainability, to
, frozen and all Coles fresh vise us canned fish and ad n is needed where actio ce fish to ensure we sour working with basis. Coles will be entifying on a sustainable ood suppliers in id ort our seaf
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• Move to certified sustainable palm oil by 2015
• Phase out of cage eggs by 2013
• Sow stall free pork by 2014
• Phosphate free laundry and cleaning range by 2012

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All about Coles 2011

11

Australia first
We always try to source products locally and only import if Australian supply is insufficient to meet our customers’ needs. During the year, we were proud to announce we have more products carrying the
Australian Made/Australian Grown logo than any other brand, because our team searches far and wide to seek out local suppliers to bring our customers the freshest and tastiest products available.
Rugby Farm

A supplier for more than 14 years and well established in growing broccoli, lettuce and sweet corn,
Coles approached Rugby Farm in 2008 about growing baby corn due to Australia’s reliance on imported baby corn.

“In 2009 we started supplying into Queensland and then over a three month period we also started supplying New South Wales, Victoria,
South Australia and Tasmania.
“Coles’ long-term commitment to Australian produce and specifically our locally-grown product, allowed us to slowly increase the level of production to make it viable”, Matt says.
Rugby Farm now grows approximately 75 hectares of baby corn a year in the Lockyer Valley to the west of Brisbane and in Bowen in northern Queensland.
The dual locations mean the business can supply
Coles all year round. The crop is harvested by hand in the field and then transported to the packing shed where it is hydro cooled then graded and packaged.

All about Coles 2011

Based in Australia’s dairy farming heartland in Gippsland,
Victoria, Jindi Cheese has been selected to produce a high quality
Reserve range of cheeses exclusive to Coles. As the largest, private, locally owned speciality cheese manufacturer in Victoria, Jindi employs eight expert cheesemakers and up to 70 people during peak periods.
Using locally sourced milk from Gippsland’s dairy farms, the new Reserve range includes Cremeux, Washed Rind and Estate
Blue and will be available at Coles Deli cheese shops in 170 supermarkets nationally.
Jindi’s Head Cheesemaker, Franck Beaurain, was born in
Normandy, France, but Australia has adopted him to make a cheese that can stand alongside the very best in the world.
In August, the Jindi Reserve 1kg Brie was awarded the best Brie/
Camembert of the Royal Melbourne Show Fine Food Awards 2011 and was the only gold medal received in these two categories.

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Up until now, the market for matured cheese has been dominated by expensive imports but the introduction of the
Reserve range in Coles will help to further develop Australian palettes and increase the demand for artisan cheese.

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“In conjunction with
Coles, we developed a conversion strategy to change over to
Australian grown baby corn from the imported baby corn,” says Matt Hood, whose grandfather founded the business in 1912.
12

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Jindi Cheese

With a commitment to providing Australians with nutritionally-rich food, family-run Rugby Farm has worked with Coles to find a local solution to imported baby corn and now supplies the product to
Coles all year round.

After significant research and investment into growing conditions, harvesting methods and packaging operations, Rugby Farm has grown to become one of
Australia’s largest growers of both corn and beans over the last 10 years.

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anti-condensate heater controls to glass door freezers at more than 420 stores to reduce the energy use of the heaters in the doors.

We’re also designing our freehold stores to be more energy efficient in the future. Over the past year, we worked with Green Building
Council of Australia to develop a ‘Greenstar’ rating tool able to rate the sustainability of future supermarket developments. Our new design will incorporate, for example, better building insulation, more efficient refrigeration cases and better humidity control to reduce air conditioning and refrigeration energy consumption. Our new store at
Greenacre in New South Wales, which is under construction, will be the first development to test our Greenstar rating tool.

Recycling and waste
Over the past 12 months, our supply chain and supermarkets have been working hard to reduce stock loss and waste. As an example, through better management of apple stock, we have saved the cost equivalent of approximately 780,000 kilograms of apples.

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automatic lighting controls at over 520 stores to reduce the energy used outside trading periods; and

25
Organic food waste is currently collected from approximately
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239 supermarkets across Victoria, New South Wales, South
15
Australia and Western Australia to produce compost.
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Over 100 supermarkets send fat and oil for recycling, where
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night blinds on refrigeration cases at more than 620 stores which reduce night-time energy use;

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To date we have installed:

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2011

2010

This year we recycled more than 58% of our waste or 141,022 tonnes of cardboard, paper, plastic, metal and organics. Over nine months our liquor stores reduced their total waste by 19.2% andTraining hours increased their ee recycling rate by 31.8%. per employ

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A range of energy saving initiatives at Coles over the past two years means we’re getting better at saving the energy used by our supermarkets for refrigeration, lighting and climate control.
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Shopping bag and plastic recycling
We continued to recycle single-use plastic bags in all our supermarkets during the year. Following the success of our green bag recycling program in June 2010, where customers returned old or unwanted shopping bags made of polypropylene to Coles, we launched a second bag drive in September 2010. Approximately
78,000 bags were returned and converted into outdoor furniture and donated to 100 primary schools across Australia.
In the coming year, we plan to expand our plastic recycling program and pilot the return of flexible plastic packaging, such as fresh produce bags, bread bags and other plastic wrapping used for food, across more than
140 stores in Victoria. This packaging will also be recycled and turned into furniture for schools and kindergartens.
13

Our community
Coles’ team members and stores are part of their local community, supporting fundraising activities, engaging with schools and community groups. Through the generosity of our team members and customers, we raised and donated over $22.3 million to fundraising events and charities, such as Cancer Council, the Queensland Premier’s Disaster
Relief Appeal, Foodbank, Landcare, Guide Dogs, and children’s hospitals in Western Australia, Queensland and New South Wales.

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14

All about Coles 2011

help

ed
• $22.3 m illion rais commun ity progred and donated ams dur t
• $5.3 m ing the y o illion rais ear the Quee ed for th ose affec nsland fl te oods and
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Council H or the Ca elpline ncer
• More t han 1.1 m to people il in needlion kgs of food d onated • 330 sc hool gar den proje the year and ove cts r 1000 sin funded during ce 2008

Coles Junior Landcare
Garden Grants
In March 2011, we celebrated funding 1000 school and community garden projects through the Coles Junior Landcare Garden
Grants program since the program launched in 2008. Schools were invited to participate in a photo competition. More than 590 entries were received for three age categories, as well for the Australian Geographic award and the
People’s Choice award.

Our intermedi from St Jamesate category winner, Ben Fr agiad Primary School,
Muswellbrook, akis,
NSW.

Sports for Schools

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15

Rebuilding after Cyclone Yasi and the
Queensland floods

Coles was one of the biggest fundraisers for the Queensland
Premier’s Disaster Relief Appeal which was launched to assist those affected by Cyclone Yasi and the Quee nsland floods in early
2011. Over $5.34 million was raised, inclu ding a $1 million cash donation by Coles.
We also worked with Red Cross and othe r emergency services crews to provide essentials and food to those affected.
Over 25 Coles stores were impacted by the floods and Cyclone Yasi
- the worst of these were at Emerald, Fairfi eld and Ipswich. With our usual major road and rail transport routes into Queensland cut off, it was necessary to organise air and sea freight to make emergency food deliveries to the most affected areas. About 120 tonnes of food were airlifted to service Cairn s and Townsville. One of our distribution centres for Queenslan d was flooded making it inoperable. As a consequence, we estab lished a temporary facility and re-routed deliveries from Sydney. Arou nd 500 tonnes of food were sent to far north Queensland by truck and more than 700 tonnes sent by sea freight from Sydney to service Cairns and Townsville.

16

All about Coles 2011

To ensure the ongoing availability of basic food items for the town of Emerald, a temporary store was estab lished at Emerald Police and Citizens Youth Club. The temporary
Coles stocked about 200 staple food and grocery lines and operated from January until a new supermarket opened in June 2011.
In June, we were also proud to re-open our doors at Fairfield, featuring our latest store format and a new store at Ipswich will be built in the coming year.
In the months following the floods and cyclone, our stores in the Cairns and Innisfail area worked with
Queensland Parks and Wildlife to ensure regular food drop s of fruit for our native cassowaries left without access to their natural food supply.

Food donations
During the year we leigh, VIC donated over 1.1 million
Coles Oak food at ing fresh
Donat
kilograms of food to people in need through Foodbank
Australia, SecondBite and the Salvation Army. We also conducted a pilot program to collect fresh produce from 20 supermarkets in Victoria,
Tasmania, South Australia, Western Australia and Northern
Territory in the lead up to launching a national fresh food donation program with SecondBite in the coming year.

Sydney Children’s Hospital
Our supermarkets in New South Wales raised $80,000 in customer donations for the Sydney Children’s Hospital Gold Week Telethon in 2011. The funds go to providing equipment and care for sick and injured children.

Former pa tien for Sydney t Charlotte – the fa Children’s
Hospital. ce of Coles fundrais ing Our three year performance summary

Contact details
For feedback about our report or to ask a question, contact:

2009

2010

2011

Revenue ($b)

28.8

30.0

32.1

Earnings before interest and tax ($m)

831

962

1,166

Food and Liquor comparative sales growth

4.6%

5.0%

6.3%

Number of stores

2,258

2,223

2,239

Supermarkets

763

742

741

Liquor

775

766

785

Hotels

95

96

93

Convenience

625

619

620

Renewal stores

35

50

144

Total team members

113,311

106,030*

102,520*

* Decline on 2009 reflects shift to more permanent part-time employees and less casuals.

Coles Corporate Affairs
Level 5, 800 Toorak Road
Hawthorn East VIC 3123
Tel: 1800 061 562
Email: Coles.Customer.Care@coles.com.au
Attn: All about Coles 2011
The information in this report has been compiled as at 30 June 2011. Coles
Supermarkets Australia Pty Ltd and its related companies (including their directors, officers, employees and agents) (Coles) make no warranty about the accuracy or completeness of this information. Coles will not accept any liability for any loss resulting from your use of this report including any investment decisions you may make on the basis of its content. You should obtain professional advice before proceeding with any investment.
© Coles Supermarkets Australia Pty Ltd 2011.
You may not reproduce any section of this report without the prior written consent of
Coles Supermarkets Australia Pty Ltd.

Printed on Sovereign Silk from K.W.Doggett Fine Paper at Print Dynamics.

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