Bunnings to launch online store for UK shoppers: Why hasn’t the hardware chain ever started one in Australia?
Wednesday, March 15, 2017/
Bunnings customers in the UK get to experience the same classic sausage sizzle and “lowest prices” as Australian shoppers, but they’ll also soon be getting something local Bunnings fans have only dreamed of: an online store.
The chief of the UK arm of the hardware giant, which expanded into the British market after parent company Wesfarmers purchased UK hardware chain Homebase in 2016, delivered a presentation to analysts on Tuesday that promised the delivery of a transactional website within the next 18 months, reports The Australian.
Managing director Peter Davis said it is a complete necessity for Bunnings to establish an online offering in the UK market, and that the business will spend the time to get the online product offering right.
While the British stores look towards an e-commerce model, back in Australia Bunnings remains a firmly bricks-and-mortar offering, despite significant interest from shoppers who want to order products from home and the company’s website attracting 13 million site visits a month.
If a user types “Can you shop online at…” into Google in Australia, the first four auto-complete answers feature Ikea, Aldi, H&M and Bunnings.
“I think there might be some learnings from the UK to bring back here,” says Paul Greenberg, founder of the National Online Retailers Association, who adds that the hardware chain has always gone its own way, despite increasing interest from shoppers in an online offering.
While customers can browse some of the range for Australian Bunnings stores online, they are only able to print a “Wish List” of items to take in store.
Bunnings Australia told SmartCompany the retailer already has a “digital ecosystem” that delivers product details and DIY information to customers, but the company will continue listen closely to customers about their needs.
“Bunnings has been an active participant in the digital landscape for many years, investing significantly to build a wide-reaching and engaging digital ecosystem across multiple channels, with the Bunnings website as the hub,” Bunnings managing director Michael Schneider said in a statement to SmartCompany.
“Our digital ecosystem focuses on providing information and services for customers, as well as practical and helpful advice and inspiration for DIY projects. Our customers continue to respond well to our digital offer, with more than 13 million visits to our Australian website a month.”
The hardware chain has also not moved to include click-and-collect models, even after now-closed competitor Masters launched its own online portal offering.
Other big box retailers have also started playing in this space, with Ikea launching an e-commerce offering in some states, while Bunnings competitor Mitre 10 has a “click and collect” order model across some of its range. At electrical retailer Harvey Norman, shoppers can log on and can schedule an in-store pickup of whitegoods, or have them delivered to their doors.
However, it doesn’t look like the Wesfarmers-owned hardware giant will look to play in the online ordering space any time soon. A spokesperson for the company told Fairfax yesterday that while Bunnings would never rule it out, “economics in Australia are different”.
Bunnings goes its own way, but should also think about customers
The big challenge to building an online delivery model for retailers like Bunnings is the size of the country alongside the small customer population, says Greenberg, but the chain has also developed an identity based on in-store retail.
“I think where we’re at on this is all the supply chain issues we have in this country; it’s a massive country with small population. In the UK, they have the critical mass, dare I say the scale [to make online work],” he says.
“But I think Bunnings over here have always prided themselves on not offering home delivery.”
Retail experts have previously told SmartCompany Bunnings positions itself as a destination, rather than just a store.
“Bunnings is a destination retailer because shoppers are willing to take the effort to come in not just for products, but for the experience,” said Gary Mortimer, associate professor at Queensland University of Technology Business School, last week when discussing Bunnings’ plans to develop a site in Brisbane that is twice the size of its usual warehouses.
While Bunnings has earned its position as a super-store that goes its own way over the years, this doesn’t necessarily mean the brand should avoid shoppers’ interest in online retail entirely, says Greenberg.
“They seem to have gotten away with not offering those online options that I think customers actually like. They’ve got their own way and they’ve earned that right over many many years, but I’m probably not a big fan of that approach [of not offering online retail].”
That said, the Australian market does present its own challenges for delivery of goods, Greenberg says. With Amazon’s pending entry into the Australian market and international retailers like Kaufland arriving, Greenberg believes global retailers might be in for some challenges on the online delivery front once they hit our shores.
“My approach is a rising tide lifts all boats, but I think they will find that they’ve got their work cut out for them. They’re going to encounter challenges, particularly around density,” Greenberg says.
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