| Type | Public (NZX: WHS) |
|---|---|
| Industry | Retail (department & discount) |
| Founded | North Shore, New Zealand, 1982 |
| Headquarters | North Shore, New Zealand |
| Key people | Stephen Tindall, Founder Mark Powell, CEO |
| Products | The Warehouse Warehouse Stationery |
| Revenue | NZ$1,735,030,000 (2007–08)[1] |
| Operating income | NZ$134,687,000 (2007–08)[1] |
| Profit | NZ$90,769,000 (2007–08)[1] |
| Total assets | NZ$654,937,000 (2007–08)[1] |
| Total equity | NZ$334,656,000 (2007–08)[1] |
| Employees | 14,800 |
| Website | www.thewarehouse.co.nz |
The Warehouse Group Limited, (NZX: WHS) founded by Stephen Tindall in 1982, is the largest department store retailer operating in New Zealand. The Warehouse is largely a discount store similar to Wal-Mart in the United States, however The Warehouse sells far more generic brand merchandise than other discount or department stores. The company also formerly had operations in Australia, which were sold to Australian Discount Retail. For the fiscal year ending October, 2005, The Warehouse reported net income of NZ$71.9 million on NZ $2.224 billion of sales revenue (3.6% profit margin).
As of 2005, the company had 253 stores throughout New Zealand and Australia along with more than 6 distribution centres in total. On 24 November 2005, The Warehouse announced that was selling its Australian operation for AU$98 million (NZ$99 million).
Colloquial names for the company's stores include "The Big Red Shed", "WareWhare" (pronounced wah-re fah-reh,(rolling the r) whare is Maori word for house), Warehu and "The Wuds".
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The Warehouse operates discount retail department stores selling a broad range of non-grocery and grocery products. As of January 2005, The Warehouse employed 7,531 people in New Zealand. The Warehouse's corporate headquarters are located in North Shore, New Zealand.
Apart from retail locations, it operates 2 distribution centres located in Wiri, New Zealand and in Rolleston, New Zealand.
In addition to its own operations, it also owns various brand names that are located within the stores. It has gardening facilities located in Auckland, Hamilton and in Christchurch. Along with its gardening brand Just, it also operates nearly 30 "in-company" brands.
The Warehouse is publicly traded on the New Zealand Stock Exchange with the security code WHS (TWH was used previously).
"Warehouse founder wants to buy all Red Sheds". The New Zealand Herald. 2006-09-14. http://www.nzherald.co.nz/section/story.cfm?c_id=3&ObjectID=10401320. Retrieved 2007-04-27.</ref>
The Warehouse's chief competitors in the national retail scene include Super Cheap Auto (automotive products), Farmers (lowscale department stores), Kmart (discount department stores) and the Briscoes Group (discounted sports and homeware store chains).
With the launch of 'The Warehouse Extra' at Sylvia Park, The Warehouse expanded into the grocery business (see 'Hypermarkets' section below), though it is unclear whether this enterprise will eventually be extended to a substantial number of other stores.
The Warehouse has always been heavily criticised for poor products despite offering these products at exceptionally low prices. In the early nineties, The Warehouse generally stocked low quality, easily breakable products. However, in recent times, the company has put pressure onto suppliers to increase the quality of their products. Despite this The Warehouse has been known to have product recalls of items they exclusively sell. A recent example is a brand of cycle helmets sold at The Warehouse that had the insulation detach from the shell of the helmet. As a result all helmets were recalled and customers who purchased these helmets asked to return for a refund.[8][9]
The company operates a comprehensive returns policy. A "money back guarantee" policy (returns accepted for any reason) is available on most products, excluding underwear, pre-recorded media and perishable products. Some industry observers believe this is why The Warehouse has been so popular in New Zealand. This concept has not worked in Australia, particularly due to the fact that there are many other more well-established department store chains (K-Mart, Target, Big W). Australian stores no longer advertise a "money back guarantee." In late 2005, The Warehouse Group announced its decision to close its Australian arm.[10]
The Warehouse has always been a popular target for shoplifters; however, since the mid-nineties, security has been increased, including the introduction of security guards, surveillance cameras and plain-clothes security professionals.
</ref> More recently The Warehouse was blamed for the closure of Sounds Music stores as well as illegal downloading of music.[11] The management of The Warehouse dispute these claims.
In May 2007 to mark the 25th Birthday of The Warehouse the company released 13,000 balloons from Dairy Flat. This sparked concerns from the Department of Conservation and other environmentalists as the balloons have been known to endanger wildlife.[4][3]
In December 2007 a Whangarei woman lost her job at The Warehouse after leaving the comment on her Bebo page saying "work sux" and that having to work to midnight was "gay like the management."[12]
In December 2009 it was announced that The Warehouse staff would be taking industrial action due to issues with staff having their hours extended to 50 hour weeks in the lead up to Christmas and staff having to work late at night.[13]
In 2000, the company entered the Australian retail market. It acquired the Clint's Crazy Bargains and Silly Solly's retail chains. At the time of purchase, those chains had around 117 stores.[14]
In 2003 the company built a $33 million (AUD) distribution centre in Queensland, to service the country. Later that year, the company introduced its Tui and Tolas inventory management systems from New Zealand.
As of 2005, the Australian arm was still under-performing. Sales for 2005 were at $518.8 million (AUD), compared with $567.3 million (AUD) in 2004. The Warehouse Group Limited announced in November, 2005 that it had entered into a conditional agreement to sell The Warehouse Australia business to Catalyst Investment Managers and its parent PPM Capital Limited (together, Catalyst) and Castle Harlan Australian Mezzanine Partners, acting on behalf of the CHAMP I and CHAMP II funds (CHAMP) for A$92 million (NZ$99m). The new entity was known as Australian Discount Retail (ADR). As part of the transaction, The Warehouse Australia's Sydney Head Office would be sold to Investec Wentworth Specialised Property Trust. While the effective date for the transaction was to be 27 November 2005, completion of the sale was expected in early 2006 and was subject to normal regulatory approvals.
At its formation ADR also purchased the discount store operations of Miller's Retail, including the Go-Lo, Crazy Clark's and Chickenfeed (Tasmania) chains. There were 335 such stores at the time of sale.
After the sale of the Australian operation, Warehouse stores were renamed Sam's Warehouse.[15]
In June 2006, "The Warehouse Extra" opened at Sylvia Park, Auckland. It was the first of a planned chain of hypermarkets, at 135,000 sq ft (12,500 sq m). In a similar fashion to the Wal-Mart Supercenters of the United States, the foodmarket department aisles are placed at a perpendicular angle to the general merchandise. It is the first store to feature an in-store bakery, pharmacy and cafe, and instead of the usual tall industrial shelving, a more conventional store shelving system has been used. The store also features a lot less red than in traditional stores, but the familiar concrete floor still exists. The next branches of "The Warehouse Extra" were in Whangarei and Te Rapa in Hamilton. In October 2008 The Warehouse announced that they will be canning "The Warehouse Extra" format with stores reverting to the more traditional style of store coming months.[5] There was four of The Warehouse Extra in Auckland (Albany, Manukau, Sylvia Park and Westgate). Today "The Warehouse Extra" brand is used on larger traditional stores, many existing stores have taken on "The Warehouse Extra" branding. Stores carrying "The Warehouse Extra" brand are much larger and stock a greater range of products.
On Thursday 23 July 2009, The Warehouse Group opened the first of its smaller-concept stores, The Warehouse Local, in Mosgiel. These stores are approximately 2000 square metres in size, compared with the usual 5000 square metres seen in larger locations. Another 3 stores are intended to be launched per year, following this concept, over the next five years.[6] This will give The Warehouse a chance to have market domination in smaller towns as well as the larger towns and cities in New Zealand.
The Warehouse went public in 1995. Since then the stock has climbed from $1.29 to $5.54 in 2005. During 2005, the stock dropped dramatically due to worse than expected results from the Australian operation.[16]
However, the company has not been without success. It is New Zealand's largest retailer and one of the largest companies in New Zealand in terms of annual revenue. It is well ahead of its nearest compeititors Briscoes and Farmers in terms of sales. Various different explanations have been offered for this:
The Warehouse operates 2 major formats under 3 different divisions:
| Executive Board | |
| Mark Powell | Group Chief Executive Officer |
| Stephen Tindall | Founder |
| Directors | |
| John Avery | Director |
| Robert Challinor | Director |
| John Dahlsen | Director |
| Graham Evans | Director |
Share price
Warehouse corporate sites
Financial results
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