By Rebecca Howard
Aug. 1 (BusinessDesk) - The Warehouse Group has launched its new e-commerce venture TheMarket in a bid to tap into the $4.2 billion New Zealander's spent online in 2018.
TheMarket has launched with 1,500 brands and more than 1 million products. It includes local brands like Karen Walker, WORLD, Father Rabbit, Citta and Barkers, and Australian and international brands PE Nation, Cue, Billabong, Cotton On and The Nile, it said.
Warehouse Group chief executive Nick Grayston said the $4.2 billion spent online is only going to get bigger.
"It’s a significant opportunity, especially when you look at New Zealand compared to other countries. Our online spend is currently about 9 percent of total retail spending, compared to the UK who are at 18 percent," he said.
Warehouse has been attempting to adapt to the changing retail environment in which online purchases have undermined the traditional 'bricks and mortar' networks.
Last week, it said better trading and gains from its transformation programme meant adjusted profit after tax will beat the previous guidance of $63-$66 million in the year ended July 28. it now expects to report adjusted profit of $67-$70 million, up from $59 million a year earlier.
TheMarket is a subsidiary of Warehouse Group, operating under a structurally separate operating model, with its own board made up of non-executive directors and management appointed by the group board.
It is the sixth consumer brand in the group, joining The Warehouse, Warehouse Stationery, Noel Leeming, 1-Day.co.nz and Torpedo7.
Customers can choose to get their items delivered or collect from a network of ‘MarketPoint’ locations operated within existing retail stores throughout New Zealand. Currently 19 Noel Leeming, Warehouse Stationery, The Warehouse and Torpedo7 stores act as ‘MarketPoints’ for pick up, return and click and collect. Additional stores will be rolled out over the next 12 months, it said.
“Most Kiwis live within 30 minutes’ drive of a local group store, so the existing omnichannel and distribution structure is a significant advantage, and will also help drive cross-brand foot traffic and sales for the group,” said Justus Wilde, TheMarket chief executive.
TheMarket has also partnered with Fonterra Farm Source to create MarketPoints at 10 Farm Source stores around the country, so shoppers in rural areas can also take advantage of the site’s convenience. More MarketPoints will be added within that chain over time.
Warehouse stock last traded at $2.27 and has gained 11 percent so far this year.