Bunnings is beginning development on a new-look Brisbane store twice the size of its usual sites, with one retail expert believing the home improvement chain is further establishing itself as a “destination retailer”.
News.com.au reports construction is beginning for the store in Newstead, Brisbane, on a site Wesfarmers-owned Bunnings purchased between 2011 to 2012.
The total floor area of the new store will reportedly be 17,000 square metres, double the size of a typical Bunnings store store, which is reportedly around 8000 square metres.
Photos from Thomson Adsett architects, the business that the new store, show a multi-level store with a separate shopping precinct underneath.
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News.com.au reports the store will include an underground car park, along with the typical Bunnings inclusions of an outdoor nursery and timber sales area.
Thomson Adsett describes the design as “sawtooth”, relating to the area’s heritage of wool stores and industrial buildings.
Retail expert and Associate Professor at Queensland University of Technology Business School Gary Mortimer tells SmartCompany Bunnings’ huge new development will see success thanks to its identity as a “destination retailer”.
“Bunnings is a destination retailer because shoppers are willing to take the effort to come in not just for products, but for the experience,” Mortimer says.
“It’s for families on the weekend, wanting to have a shopping experience and a sausage sizzle.”
Mortimer believes Bunnings is similar to Swedish furniture retailer IKEA, which he says helps customers get “actively involved” in the shopping experience.
And this store is unlikely to be the last, says Mortimer, who believes Bunnings will continue to “selectively” place these superstores in key suburban areas.
“This store is interestingly placed, as it’s right in the middle of the city, and there’s a massive amount of high density and high-income living nearby,” he says.
“There’s also not really any big hardware chain close to where they’re putting it, they’re tapping into the area’s growth.”
“I think they’ll look at other areas in Sydney and Melbourne where there’s a high proportion of the population in one area, with high disposable income.”
Bunnings to move on 11 old Masters sites
This news comes as Bunnings reportedly moves into 11 store locations left from Woolworth’s failed Masters hardware chain.
Seven of the stores are located in areas a Bunnings store already exists, so the existing stores will reportedly pack up shop and move to the Masters sites. Four entirely new stores will open, along with 21 separate new outlets by September, reports Fairfax.
This would bring the number of Bunnings stores up to approximately 335.
Mortimer believes Bunnings is the “clear” market leader with Masters out of the picture but warns the retailer should not rest on its laurels.
“Now it’s all about market share maintenance, I can’t imagine they’re looking for any further growth at this level,” he says.
“They’re probably also defending themselves from any potential new market entrants.”
Those entrants could be the likes of local Australian Super Retail Group speculates Mortimer, or it could take the form of another international retailer.
However, Mortimer maintains no existing market force could hope to challenge Bunnings’ position.
“Metcash is the only other player, and they have a different offer with smaller stores aligned to tradespeople,” he says.
“A big global retailer could have a look at the market and enter, and there’s no reason why Lowe’s wouldn’t have another look at the market.”
Bunnings told SmartCompany it could not comment on the new developments as an on-site announcement was coming in the following weeks.