Coles wants 40 per cent of products to be its own brand

COLES is making changes to its products as they try to win back customers from Aldi and it’s unlikely to please everyone. SEE HOW IT WILL AFFECT YOU

Coles own brand cheese. Picture: Andy Rogers

COLES wants 40 per cent of all products sold in its supermarkets to be its own label within five years, but it insists it won’t leave shoppers with little brand choice.

Coles chief John Durkan has told an investor strategy day the supermarket chain was working to build an “own brand powerhouse” with the goal of having 40 per cent sales penetration of its private label range by 2023.

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A 2-litre plastic bottle of Coles Home Brand milk.

But the outgoing boss of the supermarket giant insists the push to take Coles-branded lines into new areas would not reduce customer choice, adding there was high demand for the supermarkets private label range.

“The last thing we need to do is push stuff onto consumers that they don’t want,” he said today.

“We need to make sure we have the right products with the right quality and right price … we are never going to take away choice.”

Mr Durkan said the proportion of Coles-branded products to overall sales was currently in the “high twenties” as a percentage.

It was above 50 per cent in fresh categories such as meat but considerably lower in dry grocery lines.

Coles chief John Durkan. Picture: Justin Kennedy

The latter is where Coles would focus on, particularly in lines where there was not a “value proposition”, Mr Durkan said.

“There is lots of opportunities in this space … it’s a choice for customers,” he said.

Both Coles and Woolworths have increased their private-label ranges — which they earn more profit from — in recent years as they confront new challenges from Aldi and online shopping.

Mr Durkan was speaking at a Wesfarmers strategy day.

Perth-based Wesfarmers owns Coles, Bunnings, Kmart and Officeworks among other businesses.

Wesfarmers is spinning off Coles into a separately listed business on the Australian stock market in a process which will result in Mr Durkan handing the reins to Metcash supermarkets chief executive Steven Cain.

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