One name, two retail giants: meet the other Woolworths

James Thomson
April 9, 2014
The Age
Woolworths might already be a household name in Australia, but local shoppers are going to get used to another, quite different company of the same name after South Africa’s Woolworths Holdings lobbed a $2.15 billion takeover for David Jones.
This is giant deal for Woolworths Holdings, which has a market capitalisation of $5.5 billion and annual revenues of $4 billion, compared with DJs revenue of $1.8 billion.
But South African retail giant does not want for local knowledge and could have an ace in its pack in the form of chief executive Ian Moir.
Mr Moir is best known in the Australian market as the chief executive of Country Road, the upmarket clothing and homewares group in which Woolworths Holdings owns an 88 per cent stake.
Mr Moir was appointed the board of Country Road in October 1998, serving as chief operating officer before taking the top job in November 2000.
A decade later, after a relatively successful stint at Country Road, Mr Moir returned to the parent company, joining its board in January 2010 and taking the role as chief executive of Woolworths Holdings in November 2010.
Mr Moir will have an intimate knowledge of the Australian retail landscape and a good working knowledge of the David Jones business, given Country Road has long been a key concession within David Jones.
Woolworths Holdings is also well placed to understand David Jones’ market. In its home country it targets a sells a similar niche of high-end clothes and homewares and high-quality groceries. The businesses have similar reputations as reliable, slightly staid retailers who know their wealthy market inside and out.
One key difference between the two is that Woolworths Holdings is riding on the back of the rapid growth in South Africa’s middle class; it has become an aspirational brand in a way that DJs isn’t.
Woolworths Holdings has 400 retail stores and franchises across South Africa and the Middle East and the wider African continent, including in Mozambique, Kenya, Uganda and Ghana.
Like most modern retailers, Woolworths also has a range of financial services products including credit cards, insurance and personal loans. These products are offered through a partnership with Absa Bank.
Exactly how Woolworths Holdings plans to tweak the model of David Jones remains to be seen, but the new Woolies looks certain to make a big splash at the top end of Australia’s ultra-competitive retail market.
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