Supercheap Auto, Rebel go hard on $60m Salesforce-led replatforming

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Supercheap Auto, Rebel go hard on $60m Salesforce-led replatforming

Online sales surge.

Australian lifestyle retailer Super Retail Group has pumped $60 million in capital expenditure into a ground-up online systems re-platforming project, as it pivots to make brands Supercheap Auto, Rebel and BCF hold their own in an omnichannel world.

The new strategy and its price tag were spelled out to investors during the company’s annual results on Tuesday along with a successful move to relaunch websites for all three brands on Salesforce’s ecommerce cloud.

The big push to get Super Retail’s omnichannel efforts humming comes as its outdoor and sports brands fend-off French budget outdoor and fitness online brand Decathlon, which recently launched a store in Sydney with the aim of securing a permanent foothold down under.

The big challenge for Super Cheap retail’s online sales efforts to date has been that, despite holding sizeable market share of customers across its brands, collectively exploiting whole of enterprise economies of scale and infrastructure was yet to be achieved.

But that’s changing fast. The company now says its replatforming efforts are delivering results both in terms of online sales growth and crucial customer offer channels such as store memberships and clubs.

“Our investment in building our omni-retail capabilities has underpinned strong growth in our online sales and we continue to extend our offering to our customers through additional ranges and services and improved in-store and online experience,” Super Retail Group chief executive Peter Birtles said.

“Growing our share of customer spending in our markets is a key priority as the retail industry evolves with the impacts of new competitors and of technology.

"We aim to incrementally grow our share of customer spending in stores while significantly increasing our share of customer spending in digital channels.”

The numbers behind that growth are not timid. Super Retail cited active club members of 5.5 million at June 2018, up from 4 million in 2015.

Also booked under the financial umbrella of “sustainable omnichannel” is a replatforming of “core information systems” to be more “flexible, scalable and secure” that’s also included in the $60 million spend, Super Retail said.

Supply chains are also being overhauled to accommodate click and collect and direct delivery to customer options.

So far, Australia’s revheads are paying the move.

“Online sales increased by 85 percent on the previous corresponding period, driven primarily by industry-leading click-and-collect service levels,” Supercheap Auto’s report card to investors said, though the company did not specify how much of $1 billion in total sales were made online.

Sports nuts went even harder online. Rebel’s online sales increased by 152 percent for the financial year “benefitting from the introduction of click and collect in October 2017.”

Super Retail’s outdoor retailing segment, which includes BCF, Ray's and the recently acquired Macpac businesses, also grew fast online, despite being the most challenged.

BCF booked a 76 percent increase in online sales even though its share of customer spend ebbed because of “competitors increasing their store footprint and pricing intensity.”

Ray's and Macpac, which are in the process of being merged, look next in line for a systems overhaul once a store and branding rationalisation is completed.

Super Retail Group declared a normalised net profit after tax of $145 million for the financial yerar ended 30th June 2018, an increase of 7 percent.

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