Hardware retail giant Bunnings is pitched to open it’s first small scale store by the middle of this year at Vicinity Toombul Shopping Centre in the inner northern suburbs of Brisbane, says the Northside Chronicle. Experts think it’s a good move for the hardware giant and it could be Bunnings’ way of competing with other big box stores that could emerge in the future.
Reports suggest the development, fitout and stocking of the old Coles site will cost around $8 million. Bunnings general manager of property Andrew Marks indicated the new store would employ 50 staff – approximately half the number of staff employed at a Warehouse store. “It’s an exciting opportunity as it’s located within an existing sub-regional shopping centre,” he said. Bunnings thinks it will breathe new life into the shopping centre and it will service the inner northern suburbs effectively.
With increasing population density, impulse purchase behaviours, and a clear shift towards apartment living at 60 per cent of demand for the past decade (SGS Economics & Planning), the move makes sense – even if the market opportunity is currently undefined.
The new model is reflective of that of the McEwans chain taken over by Bunnings in 1993. “The good thing about that smaller range is people just impulsively buy things they might need at home, like hooks to hang your pictures or tape for fixing things, It used to work really well for McEwans, “ says hardware consultant of DGC Advisory Geoff Dart.
With DIY market growth at around 5% per year (IBISWorld) there is a gap to be filled. While supermarkets offer some basic maintenance supplies, and Kmart and Big W have small tools kits on offer, the authority of Bunnings to offer advice and knowledge will make them the clear preference.
While convenience will be a big selling point for DIY city dwellers, who don’t want to travel upwards of 20 minutes to a large warehouse store, when all they need are some basic power tools or a tin of paint, the success of the model will be dependant on a well defined product range and complimentary service offering as well as a well organised long tail online offer.
The opportunity for Bunnings is to cater to the needs of it’s inner city consumers, offering solutions to their quick DIY fixes – but they will have to remain innovative in order to keep up with shifting DIY trends.