Believing that consumer behaviour is now placing a greater emphasis on “experiences” over prices and convenience in retail, David Jones will open new food halls with in-house dining, with premium menus in restaurants, and more higher-level food ranges on shelves.
Its chief executive, John Dixon, has gone on record saying that shopping has become more of a leisure and social activity where people meet friends, and he hopes to reflect such changing attitudes in its new food halls.
“Food drives footfall, it drives a greater frequency of shop and increases dwell time,” Dixon said.
“Strategically, food is going to play a very important role in terms of how we can differentiate ourselves from other retailers; it’s also something the online pure-plays [like Amazon] can’t do.”
This is not the first time David Jones has ventured into premium food retail, having established Foodchain in 2000. It will hope to have more success this time round, after the grocery folded three years later.
‘‘We have looked at all the best food outlets in the world including Eataly, La Place in Holland and Marks & Spencer, and wrapped them all up in our new offerings,’’ Dixon said.
David Jones’s new food lines will be primarily sourced from Australian suppliers, and will employ specialised buyers and developers to devise products under the brand name “David Jones Food”. The food halls will also be branded in this way over time.
Its Bondi Junction outlet will be the first food location to open, in August, with others in Melbourne and Wollongong to follow.
Meanwhile, the supplier of IGA supermarkets, Metcash, has reported a 20% fall in profits for the last financial year, and announced its chief executive, Ian Morrice, will step down next year.
The drop, from A$216.5m (US$163.6) in 2016 to A$171.9m, has largely been attributed to a home hardware acquisition from Woolworths. Its food performance was in line with last year’s results, however.
Food sales increased by 0.6% to A$9.18bn, convenience performance dropped by 2.7% to A$1.53bn and liquor receipts grew by 3.5% to A$3.33bn.
After half a decade at the helm, Morrice will make way for a successor, whose announcement will be made “in the near future”. According to chairman Rob Murray, he had previously indicated his intention to retire after five years in the role.
More from Down Under…
Fsanz consults public on residue limits for chemicals
The antipodean food regulator has put a proposal to amend maximum residue limits for some agricultural and veterinary chemicals out to public consultation.
Mark Booth, chief executive of Food Standards Australia New Zealand, said the proposal aimed to harmonise limits in the Food Standards Code with those used overseas.
“If a chemical is found in a food product that does not have an limit for that chemical, it cannot be legally sold in Australia,” Booth said.
“Chemicals can be used differently around the world because of different pests, diseases and environmental factors. This means residues in imported foods may differ from those in domestically produced products, but that does not mean there is a safety issue.”
Fsanz has assessed the proposal and concluded that its changes do not relate to any public health.
All decisions by the regulator on standards are notified to Australian and New Zealand ministers responsible for food regulation. The ministers can then decide to adopt, amend or reject standards, or they can ask for a review.
All parties are able to review the amendment and provide submissions by July 25.