NEWS
A heavily technology-based restructuring programme at Woolworths is expected to yield AU$4.9bn in savings by the end of this financial year, with supply-chain improvements the current focus, according to the retailer.
In a presentation posted on the Australian Stock Exchange website this morning, Woolworths chief executive officer Roger Corbett said "significant" progress had been made on the supply-chain component of the seven-year old Project Refresh programme.
Corbett said: "The technology required to support our new supply chain is critical to its success and was complex in its construction. We have now passed the high-risk part of our IT application development and are now applying the systems throughout our company with far better than expected results."
The technology and systems would play a key role in helping Woolworths get the most out of its recent business acquisitions, he said.
The CEO added that the retailer had finished implementing the Stocksmart forecast based replenishment system in its distribution centres and the rollout of the AutostockR store forecast based replenishment system to its stores.
Woolworths was starting to utilise the advantages provided by these systems "and more will follow as we rollout our new point of sale technology during 2006", he said.
The technology implementation is underpinning a rationalisation programme which is seeing the number of supermarket distribution centres cut from 31 to nine regional centres and two national distribution centres.
Woolworths said AU$1.3bn of the savings from Project Refresh were expected to be achieved during the current financial year.
Iain Ferguson writes for ZDNet Australia
