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Kitchen Warehouse sets up shop with digital customer in mind

Kitchen Warehouse is scaling up its expansion plans on the east coast, with two more locations potentially coming to Melbourne before the end of the year, besides the new locations in Preston, Victoria, and North Lakes, Queensland, which were announced late last year.

“There’s no national player in our bulky goods space, we feel that we can expand,” Kitchen Warehouse’s co-director Peter Macaulay said. “We want to be the Bunnings for the kitchen.”

The move is an attempt to capitalise on an approximately 500,000-strong existing online customer base on the east coast, which has represented 80 per cent of e-commerce orders thus far.

Kitchen Warehouse has retailed home and kitchenware in Perth across a portfolio of seven stores since 1996. In June last year the business merged with pureplay business Kitchenware Direct to develop a multi-channel offering.

That e-commerce pedigree is clearly visible in the store model being rolled out on the east coast, which has been designed with the digital customer in mind.

The large format offering will be enabled by click-and-collect from day one, with the centre of the stores serving as a hub for point-of-sale operations, pickups and customer service inquiries.

There will also be digital devices present for customers to browse its full online range as part of an ‘endless aisle’ initiative.

This digitally-enabled part of the offering will be complemented by a demonstration kitchen, which will allow customers to try products in-store, even going so far as letting them fry omelets to test products.

The demonstration-style offer is similar to that of US-based homewares retailer Pirch, which has defined its in-store offer on demonstration and exploration, going so far as to allow customers to shower or cook meals in their stores.

“We’re combining two key aspects of retail going forward; the convergence of digital, having that endless aisle, and then secondly retail theatre by having a demo kitchen,” Macaulay said.

Tweaking the in-store model is a move to differentiate the offering, hedging against the risk of incoming international players such as Amazon, which retail across many of Kitchen Warehouse’s categories in the US.

Macaulay explained that he’s already taken a trip to the US to observe the market and develop an Amazon counter strategy, and that the company will also emphasise their private label offering as they upscale their east coast operation.

“Amazon is certainly something we’re cognisant of,” he said. “Our category lends itself to people wanting to experience things first, which will be a key part of our store strategy.

“We’ll put a lot more emphasis on a private label offering which differentiates ourselves from the third party branded products,” he continued. We’ll expand our private label range as we gain scale, as it will give us more capability to develop our own product line.”

A version of this story written by Matthew Elmas first appeared in Inside Retail Weekly.

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