Coles Myer

Template:Infobox Company Coles Myer Ltd. is an Australian public company which operates a number of retail chains.

Early history

The company's history dates back to 1900 when Sidney and Elcon Myer opened a store in Bendigo. Separately, in 1906 the first Coles "variety store" was opened in Melbourne. Both chains grew throughout Australia through growth and acquisitions, and both independently listed on the Australian stock exchange. By the 1980s, Coles primarily operated supermarkets, whilst Myer operated a chain of mid-market department stores. The two companies merged as Coles Myer in 1987.

Businesses

The company operates a number of chains of retail outlets, including:

• Myer: department stores, with a wide selection of name-brand fashion and luxury goods. The stores were branded "Grace Bros." in New South Wales (Myer acquired Grace Brothers in the 1980s) until 2004 when the stores were rebranded as Myer outlets.
• Coles Supermarkets: one of the dominant supermarket chains in Australia.
• Bi-Lo: a budget supermarket chain.
• Liquorland: "bottle shops" (Australian term for liquor outlets) attached to Coles stores. The same division also operates "Vintage Cellars", a more wine orientated store, and Quaffers, an attempt to counter the dominance of the Dan Murphy's chain of discount wine merchants.
• Kmart: discount store, roughly equivalent to Wal-Mart stores in the United States. When opened in 1969 Kmart Australia was 51 percent owned by the US S.S. Kresge Company (later Kmart Corporation), but by 1994, Kmart Corporation had divested any remaining interest.
• Officeworks: Big Box office supplies outlets.
• Target and Target Country: general merchandise stores, including clothing, manchester, cosmestics, toys, electrical and electronics goods. "Target Country" is the result of rebranding of a chain formerly known as "Fosseys", and operates in country towns with smaller stores selling a subset of the range.
• Baby Target: as the name suggests, a seller of baby-related products.
• Harris Technology: Information Technologies reseller.
• Megamart: Big Box electrical and furniture superstores located in outer-suburban areas.
• Coles Express: rebranded Shell service stations offering discounted fuel products
• Coles Myer is also a partner, with Shell and the National Australia Bank, in Loyalty Pacific, a company which administers the FlyBuys loyalty card program.

Corporate issues

Despite its huge presence in the Australian retail industry, the company's profitability and share price performance has been spotty since the 1987 merger. The company's flagship Myer stores have struggled to cope with the emergence of "category killer" retailers in many of its specialist areas, and also with a trend away from department store fashion and back towards smaller fashion retailers.

The company tried a number of category killers of its own with mixed success. The Officeworks format was very successful, while World 4 Kids, a response to the entry of American giant Toys R Us into the Australian market, failed badly. The company's Megamart stores have survived, but have not lived up to expectations.

In 2001 the Company appointed John Fletcher, formerly CEO of Brambles as new Managing Director. This was after a long period of boardroom infighting and several management changes. Fletcher has engineered s significant turnaround in the company's fortunes. His most notable changes involved the abolition of the shareholder discount card and the acquisition of the retail operations of Shell Australia. The discount card was seen to be cutting significantly into retail margins while providing little benefit to the company. It only encouraged shareholders to hold the minimum required number of shares to qualify for the card, complicating the company's share register. It was also unpopular with institutional investors as they saw their returns being eroded while obtaining no benefit from the card themselves.

The acquisition of the Shell outlets, which were rebranded 'Coles Express' allowed Coles Myer to counter the success of Woolworths' Plus discount petrol operation, which offered a discount on fuel for shopping at company stores. It was in many ways a better offer in that Coles offered discounts on a broad range of Shell's 'superior' products, including LPG and Optimax, while Woolworths products were more generic. This forced Woolworths to tie up with Caltex to provide a recognised brand for their fuel offerde:Coles Myer