Bunnings New Zealand general manager Toby Lawrence. Photo/Jason Oxenham
Bunnings New Zealand general manager Toby Lawrence. Photo/Jason Oxenham
Bunnings New Zealand is aiming to almost double revenue in the next five years and employ a further 1200 to 1500 staff, according to its new boss.
Australian Toby Lawrance, 46, took over heading the national business from Jacqui Coombes in August and said the target was for annual salesrevenue to rise from $1.3 billion in the June 30, 2018 year to $2b by 2023.
"It's a multi-pronged approach to getting new sites and with smaller regional stores, there's opportunities for upgrades or replacements. Our expansion in the next five years is to gear up. New stores will be in regional and metropolitan areas," said Lawrance, Bunnings NZ general manager.
"We'll create 1200 to 1500 new jobs over the next five years," he said.
Third-quarter sales in New Zealand were in line with Australian performance, he said, anticipating annual growth of 9 per cent to 10 per cent.
On April 27, ASX-listed Wesfarmers declared Bunnings Australia/New Zealand third-quarter sales of A$2.7b, up 7.7 per cent on the 2016 third-quarter sales of A$2.5b. Year to date sales were A$8.7b for Bunnings Australia/New Zealand, up on $8b in the 2016 year, accounts showed.
But the business has suffered in Britain where Wesfarmers wrote off $1.1b of value from its business there.
Bunnings NZ also had a setback on March 9 in Queenstown when independent hearing commissioners refused Bunnings' application to develop a new store at Frankton because it would result in more than minor adverse effects and be contrary to planning regulations.
"We would like to still be in Queenstown and that site is our preference," Lawrance said. "The property team is looking at it," he said, agreeing the only option was now litigation, most likely in the Environment Court. "We're very excited about the potential in Queenstown."
Jacqui Coombes of Bunnings NZ. Photo/Brett Phibbs
Coombes ran Bunnings here from its New Zealand establishment in 2011 till August last year, and Lawrance said she had been promoted. She has taken on a new international human resources role for the UK/Ireland, Australia and New Zealand but still based here, Lawrance said. "She's now international director of HR."
Lawrance said Bunnings had 55 New Zealand outlets: 27 Bunnings Warehouse outlets, 20 smaller-format stores and eight trade centres.
Last month, it opened a new $30m distribution centre with 2ha indoor floor space on a 37,500sq m site at 7 Kapau Dr, two blocks off George Bolt Memorial Dr near Auckland Airport, Mangere. Lawrance said the business bought that site at the airport's The Landings and developed the hub, purchasing an extra 10ha of greenfields land next door for expansion.
Lawrence at the new $30m distribution centre, opened last month. Photo/Jason Oxenham
"This allows us to grow and we hope to get more efficiencies. We are looking at establishing a new distribution centre in the South Island as well where we could carry our top, say, 30 to 40 to 60 lines. The property team has that on the radar.
"We have 16,000 pallets here," Lawrance said of stock inside the distribution centre, adding that most goods came in containers from China, Vietnam, South America and India.
Bunnings Hastings Trade Centre opened late last year. Photo/Duncan Brown.
Lawrance - about to attend a retail sales conference is Las Vegas after a trip to Chile in partnership with giant retail associate Sodimac - has moved from Adelaide to Auckland with his family, is renting in Orakei but intends to buy and said: "My agreement is for three years. I'm six months in."
He has visited all but about six stores and indicated a strong desire for South Island expansion.
"We've got Dunedin, Riccarton. Shirley, Rangiora, Blenheim and Nelson and there's certainly good opportunities in markets like Invercargill. There's still opportunities in Auckland too."
On competition against nearest rival Mitre 10, he said: "The market is more competitive that in Australia because Mitre 10 has a really strong presence in New Zealand with a lot of loyalty to the brand. I'm more concerned about our growth plans and not so focused on what they're doing."
On Australian corporates implanting their nationals to run New Zealand businesses, he said: "I've been with Bunnings going on eight years. I don't see New Zealand as a training ground but it's a market that's a great place to learn."
Upgrades are planned at Botany, Manukau and Nelson. The Whakatane store is now being upgraded, he said: "This is updating the physical structure, extending trade yards or nursery places or perhaps kitchen and bathrooms [sales] areas. Some are being built onto. Some are reconfigured."
