David Jones’s new boss looks to future as he leads push into groceries

David Jones’ new CEO has set the department store chain on course to become a new force in premium food and groceries.

David Jones’s new chief executive John Dixon. Picture: Hollie Adams

The new chief executive of David Jones has put the department store chain on the road to becoming a new force in premium food and groceries by building out his plans for in-store shops and stand-alone food stores stocking as many as 10,000 items, mostly private label.

The first David Jones food store will be at its Sydney eastern suburbs Bondi Junction site, open by year-end, followed by its flagship Sydney and Melbourne city stores, as chief executive John Dixon sees a big opportunity opened by supermarket rivals Woolworths, Coles and Aldi racing to the bottom in pricing.

“Good luck to all of them with that race to the bottom and fighting it out over price: my experience is if you have a differen­tiated food offer and you can offer quality, freshness and innovation, then there is a very sizeable market to be had there,” Mr Dixon told The Australian.

He said David Jones had begun forging deals and contacts with premium food and grocery suppliers, harnessing the contacts of its South African-owned ­parent Woolworths Holdings — as well as British suppliers he worked with when a senior executive at Marks & Spencer.

The push into food retailing, which Woolworths Holdings has been tinkering with since it paid $2.1 billion for control of David Jones in 2014, is part of a wider strategy to hook shoppers into staying longer at its department stores and spending more.

“If you come back to what we are trying to do as a department store, I feel very strongly that … the customer is wanting far more leisure experience from department stores; somewhere where they can go and spend hours, half a day, even a day, and food is an important element giving them that dwell time,’’ Mr Dixon said.

The David Jones food and ­grocery offer will house about 10,000 products, against typically 25,000 items in a full-line Coles or Woolworths, but greater than the 2,000 products at German discounter Aldi’s stores.

It will feature fresh meat, deli and fish counters and offer semi-prepared meals to cook at home.

Mr Dixon said that a market gap had opened as the major ­supermarkets focused on their price wars.

“You need only look at what Marks & Spencer and Waitrose have been doing in the UK for decades.”