Supermarket giant Coles plans many more click and collect drive-throughs

Supermarket giant Coles says it plans to roll out many more click and collect drive-throughs around Australia, having just opened a major one in Perth.

A new $30m Coles opened today at Whiteman Edge Shopping Centre in Brabham, with its “new-generation” click and collect facility allowing customers to pull into designated drive-through lanes and press an intercom, rather than having to make a phone call.

Coles staff then emerge and pack your groceries into your car boot.

A Coles spokeswoman said the retail giant now had 18 drive-throughs operating nationally, “with plans to open lots more in a suburb near you soon”.

The existing drive throughs are:

WA – Galleria, Balcatta, Orana, Brabham

SA – Parkholme, Greenacres

NSW – Roselands, Dubbo, Swansea, Armidale, Lismore, Narellan

QLD – Glenvale, Robina, Toowong, Browns Plains, Cairns Smithfield, Cairns Central, Chermside

Having had a huge surge in online sales during the pandemic – but still lagging behind rival Woolworths, according to retail analysts – Coles has invested heavily in e-commerce user experience and capacity, including launching Click & Collect Rapid, where order to pick-up takes 90 minutes.

There has also been the launch of flypay, a secure digital wallet that allows customers to check out faster when shopping online and collect Flybuys points.

“We’ve had fantastic positive feedback on our Click&Collect Rapid and Coles Plus (membership) offers and believe flypay will remove friction for customers as they navigate from building their basket to having their order fulfilled,” Coles chief executive of e-commerce Ben Hassing said.

Coles’ most recent half-year results showed e-commerce had contributed $1bn of sales revenue for the period, growing by 48 per cent overall and by 61 per cent for direct to consumers.

The group is holding its “strategy day” briefing on Thursday – postponed from last week due to Victoria’s Covid-19 lockdown – and Citi analysts will be keenly watching for more news on its online and digital business “as Coles is well behind Woolworths in this key battleground area”.

Citi said Coles would likely focus on five key areas including more investment in its app and website for a better user experience, extracting greater value from FlyBuys and investing in its Coles & Co page, which shows specials and recipes, in place of physical catalogues.

This spend to improve online, data and also supply chain was necessary to be competitive longer term but would weigh on earnings in the near term, Citi said.

The analysts said they would also be on the lookout for insight on whether Coles was clawing back market share lost to Woolworths and others in the June quarter last year.

Coles should benefit from the unwinding of the Covid-19 local shopping trend, Macquarie analysts said on Tuesday, given their supermarkets were skewed to shopping centres and CBDs – areas most hard-hit by the pandemic.

“With the federal government further urging workers to return to the office to revive CBDs and the broader economy, we expect a strong recovery in Coles supermarket sales driven by footfall improving,” Macquarie said.