Woolies takes Studio.W to Australia

Cape Town - Woolworths has launched its private brand, Studio.W across 38 high-end Australian department stores under the David Jones banner.

Thursday’s glitzy unveiling of the move comes a year later after the retailer acquired the luxury department store chain.

Studio.W joins other Woolies private brands, RE: and JTOne, on David Jones rails. More than 1 000 brands are sold at David Jones across ten categories namely, women's, men’s and children's clothing and accessories, as well as home ware and beauty.

“Our acquisition of David Jones last year transformed our Group and was a defining moment in the history of Woolworths,” says CEO Ian Moir.

“It’s an incredibly exciting moment for our business to be launching our brands Studio W, RE: and JT One into the Australian market. This was a key part of our strategy at the time of acquisition and the teams at both Woolworths and David Jones have worked hard to deliver it on time and the stores are looking great.

“We feel we are exporting the best of South Africa, and we are expecting each of these brands to perform in different segments of the Australian market. Early signs are very positive, and the David Jones customer is already enjoying the quality and fashionability of our products at surprisingly affordable prices,” Moir says.

The A$2.1bn (R21 billion) acquisition was funded through a combination of cash, debt and equity. It is expected to deliver additional profit of at least A$160 million (R1.5 billion) per annum within five years, explains Moir.

Last month, Woolworths noted David Jones had boosted its sales for the 52 weeks to June 28, which gained 54.9%, but would only have grown 12% without the unit.

In the Australian market Woolworths will be competing with giant retailers such as Zara or Topshop and others.

“The combined scale of our group gives us a strong platform from which to defend against the influx of northern hemisphere brands into our market places. We are not afraid of competition, and our view is that the department store model has a strong future if it is done well,” Moir says.

“With the acquisition of David Jones, our group has become a southern hemisphere retailer of scale and provides us with the opportunity to deliver significant benefits to customers in South Africa and Australia. The combination has enabled us to leverage common fashion seasonality with enhanced sourcing capability”

Rand weakness

However, the recent weakness of the rand has proved to be tricky for many companies. Moir notes: “The rand has always been one of the most volatile currencies in the world. We manage the impact this volatility has on our prices by hedging the currency risk. We also work closely with our suppliers who recognise that a weaker rand can result in lower factory volumes unless the impact is shared by themselves and their own suppliers.”

The glitzy launch event held on Thursday at David Jones' eight-storey flagship building was attended by celebrities and the fashion cognoscenti who included top international model and “face” of Studio.W Joan Smalls

Christo Claassen, MD of clothing and general merchandise at Woolworths, described the launch as "an exciting time for the business".

"The launch of Woolworth’s private brands in David Jones further establishes the business in the Southern Hemisphere and broadens our access to new markets,” he says

“We've ensured that Studio.W maintains consistency across geographies by staying true to the brand's essence and identity. We're offering the same, distinct experience to both the South African and Australian consumers and deliver meticulously on fashionability, great quality and a good value proposition,” says Claassen

Woolworths has positioned itself as a global player by using internationally recognised talents such as Smalls and multiple Grammy-award winner Pharrell Williams, who is currently spearheading its sustainability-focused projects in his role as style director, to market itself.

Its ‘Our Are You With Us? campaign with Williams is about creating a better future for South Africa by raising awareness on environmental issues and raising R100 million for educational upliftment in South Africa,” says Moir

“Along with Williams, we are also working with local influencers like Minnie Dlamini, Pearl Thusi, Maps Maponyane and others on the campaign, so over the next year or so you will see the best of both international and local talent working together, which we are very excited about,” he adds.

IOL

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