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Woolworths to expand Metro network as convenience outpaces grocery

Woolworths is planning to expand its network of Metro stores, confirming more sites are slated for Melbourne and Sydney later this year.

Woolworths Metro stores operate on an average footprint of around 600sqm, are generally located near public transport, and offer a tailored range of products including grab and go solutions and ready-made meals.

The smaller, express format was launched by the supermarket chain in 2013 in Woolloomooloo, Sydney. It is understood there are now around 15 Metro stores across Victoria (seven) New South Wales (six) and Queensland (two).

Woolworths told Channel Nine News earlier this week it plans to open more stores under the Metro format nationwide in inner-city locations.

“Our customers are increasingly living in the city, they are increasingly living in smaller families and they’re time pressured and looking for more meal solutions,” Woolworths CEO and MD, Brad Banducci, told Channel Nine News.

Australia convenience store sales (excluding fuel) reached almost $8 billion in 2015, according to the Australasian Association of Convenience Store’s State of the Industry report. The channel reported value growth of 3.7 per cent year on year, outpacing grocery (1.1 per cent) for the fourth consecutive year.

The report noted that one of the convenience channel’s growing strengths is the demise of the traditional weekly shop and the growing rise of ‘top up’ shopping missions by consumers.

A Woolworths spokesperson told C&I it will open more stores in Sydney and Melbourne over the next few months.

“We know the Metro concept is resonating with our customers so we intend to continue to expand this format throughout NSW, Victoria and Queensland,” the spokesperson said.

“Our new store on York Street in Sydney’s CBD is set to open in the coming months and we’re also opening soon in a couple of other CBD and urban areas in both Melbourne and Sydney.”

Earlier this month, Woolworths reported a 0.4 per cent growth increase within its food and liquor division, with sales $10.7 billion for the third quarter.

The supermarket giant is currently in its first year of an expected three to five year strategy to restore sales and improve customer loyalty.

Woolworths plans to invest around $150 million on its supermarket business, predominately in price, customer service and loyalty.

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