From our CEO

It was a year in retail we will never forget and we should be incredibly proud of how our co-op delivered in FY21 for New Zealanders.

Our purpose of making sure New Zealanders get more out of life drives all the work we do at Foodstuffs North Island. Our end-of-year results show a strong set of financial outcomes and a strong balance sheet, and I feel proud looking back on what was delivered by our stores, our supply chain, and our support centre teams throughout this year – it truly paints a picture of passion for what we do and the New Zealand willingness to give things a go.

Through it all we had two clear focuses: keeping people safe and stock on the shelf.

 

We opened two new stores in FY21: New World Hobsonville and New World Ormiston. These stores offer innovative fresh food and meal solutions, awesome experiences for local customers, and great value every day. In addition, we opened our new Upper North Island ambient distribution centre at Foodstuffs Landing Drive, with our modern new support centre on the same site. It was a nostalgic moment to move on from more than 50 years of history at Roma Road, but a very exciting feeling to be in our beautifully functional new place that truly represents who we are and brings our teams together like never before. The massive transition from Roma Road DC to Landing Drive DC was completed without disruption to stores.

Our brands have performed well this year, with the New World transformation going from strength to strength and delivering some very successful campaigns to customers, including Little Garden and SMEG. PAK’nSAVE stayed committed to providing New Zealand’s lowest food prices, in a year where this became even more important for many New Zealand families. Four Square turned 96 years old, and connected with customers old and new with more New Zealanders shopping local during lockdown. Despite all the challenges of COVID-19 on the hospitality industry, Gilmours achieved growth and customer satisfaction remained strong. Our Pams and Value brands are also continuing to drive customer loyalty, and Foodstuffs North Island reached a milestone of over $1 billion Private Label sales in March.

Our strategic agenda has stayed on track in FY21 with all five of our strategy pillars making progress this year, despite all the issues of COVID-19:

Acting on customer insight: It has been exciting to see year two of our customer driven programme delivered through our continued partnership with dunnhumby. Adding to our suite of customer driven tools, we went live with the dhPrice tool to help our Merchandise team with pricing strategies to improve price perception. We also introduced store clusters for New World, PAK’nSAVE and Four Square that will help us to understand our customers across stores and regions, so we can make better decisions about the ranges we stock for them. We were the first retailer to launch dhShop to our suppliers in market, and more than 370 suppliers have signed up to the new model of collecting store display co-op for New World.

More efficient every day: Our Supply Chain transformation programme is on track, and our system and physical capacities have withstood incredible volume spikes through the year while still delivering 90%+ service levels.

Innovating for customers: We have a strong focus on enhancing our e-commerce and phygital offerings, and have continued investing in initiatives that improve this experience for customers. It’s been an exciting year for partnering on new product developments, including New Zealand’s first carbonzero milk, Simply Milk. Our investments in Lee Fish and Fresh Connection have realised benefits in FY21 and provided exciting fresh offers for customers in seafood and produce across our stores.

Powerful co-op culture and talent: It was fantastic to see our support centre and Supply Chain engagement score improve significantly from 67% to 71%, putting us in the top quartile of organisations within New Zealand. Member engagement is now at 81%, up from 80% last year. We have made good progress on diversity and inclusion in FY21, including the formation of a working group in the support centre, and our Future Leaders Advocacy Group (FLAG) has moved past the pilot stage to be a fully embedded part of our co-op culture. We also launched our first dedicated Māori and Pasifika leadership programme, Ruia te Kākano.

Positive force for New Zealand: We now have a strong programme under our “Here for NZ” banner that focuses our efforts in the areas where it will make the biggest difference to New Zealanders. In March we supported the launch of the social supermarket in partnership with Wellington City Mission, and Eat My Lunch is now feeding 16,500 kids each day. Our Foodies Foundation has continued to provide meaningful support to members of the Foodies whānau when they need it most, raising more than $661,000 and helping 69 families in FY21.

 

Looking forward

As we look ahead to FY22, customers continue to show us we need to deliver to their digital expectations, make sure we consistently provide value, and focus on fresh and in store execution.

I am looking forward to our co-op moving into year three of our customer driven transformation, and putting new focus on being more efficient every day. We have exciting visions for the “phygital” futures of our banners and plenty of initiatives lined up to make sure we have the capability needed to deliver these. Throughout all this we will be putting extra focus on effective change management and powerful culture – because we know we can only deliver great things when we’re in it together.

I am personally very proud of our Foodies team and what we have delivered in FY21. Thank you all for your passion for the co-op, your dedication to our customers, and your commitment to living our values every day. FY21 brought more than its fair share of unexpected moments but our co-op team always kept an unwavering focus on making sure New Zealanders get more out of life – a purpose I know will continue driving us to make a difference in New Zealand for years to come.

Chris Quin

CEO