Woolworths has lost $972.7 million throughout the first half of our financial year, and now the struggling conglomerate has been forced to appoint a new CEO.
What do these changes mean for your shopping trolley though? Will we pay for the price for Woolworths’ plummeting profits?
Masters was the straw that broke the proverbial camel’s back, with the hardware chain hemorrhaging between $2 and 3 billion from Woolworths Limited.
This massive failure meant that Woolworths’ overall profits fell by a whopping 176% from June to December 2015 alone. Profits aren’t expected to turn around anytime soon, either.
According to The Australian, Woolies is “not expecting a significant improvement in like-for-like store sales at its core Australian supermarkets” this financial year.
In fact, supermarket competition is likely to heat up, which is probably a good thing for everyday shoppers like us.
The Australian reports that Woolworths will now pour “millions of dollars into investing in lower prices in a bid to attract shoppers”.
“Woolworths saw an average price reduction of 2.1 per cent in food and liquor during the (last half financial) year”. This could be an effort to compete with cheaper supermarkets, like Aldi and Costco.
New CEO Brad Banducci is reported to have “a total commitment to customers”, so Woolworths can focus on rebuilding its bottom line through improved service.
“We have significantly invested in price, service and customer experience in Australian supermarkets”, Woolworths spokespersons said.
“Despite the financial performance, we are making progress in the rebuilding of Woolworths”, the grocery giant added.