Thursday 20 October 2016

Dunnes is planning autumn launch of its online grocery service

Published 16/05/2015 | 02:30

Click and collect bays will make their debut in flagship store
Click and collect bays will make their debut in flagship store

Dunnes Stores is gearing up for an autumn launch of its online grocery service, the Irish Independent has learned.

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The ambitious timetable will see the retailer initially target shoppers in the Dublin region, it's believed.

The Irish Independent recently revealed that Dunnes - the third biggest grocery retailer in the country - has been hunting for senior executives to head the online grocery arm.

It has now also applied for planning permission to make alterations to its flagship outlet, at Cornelscourt in south Dublin, to prepare the store for fulfilling online deliveries.

The chain, which is headed by Frank Dunne and Margaret Heffernan, also plans to mirror Tesco's successful 'click and collect' service that allows shoppers to order online and then pick up their groceries from a store.

It plans to install six click and collect bays at Cornelscourt and expand chill and frozen storage areas to hold goods ready for delivery to online customers.

The Cornelscourt outlet is the busiest in the Dunnes Stores network, generating weekly sales of as much as €2m, it's believed.

Even though the retailer is only planning to initially target the Dublin area, an autumn launch is hugely ambitions given the scale of the challenge in developing the necessary systems and logistics and back office support to deal with an online grocery ordering service.

Industry sources also said that meeting a target of an autumn launch will be challenging for Dunnes.

A launch of the service around that time would also coincide with the run-up to the Christmas shopping period - the busiest time of year for retailers.

Tesco has previously said that despite the fact that the Irish grocery market remains difficult, its online service has been particularly successful around the Dublin area.

SuperValu also has an online service, leaving Dunnes as the only one of the big three retailers without an online grocery service. It has an online clothing service, which was launched in 2013.

Tesco and SuperValu have been battling for domination of Ireland's €10bn grocery market.

Tesco was the biggest player here until the end of March, when according to research group Kantar Worldpanel, SuperValu overtook it. But the latest figures from Kantar, released this week, have the pair neck-and-neck, with each having a 25pc share of the Irish market. Dunnes has 22pc.

Tesco has been suffering here, with its sales, including fuel and excluding VAT, having fallen 6.3pc in its last financial year to €2.55bn.

Tesco operates 149 stores and 22 petrol stations in Ireland, while Dunnes Stores has 155 stores.

Both the retailers, and SuperValu, have been feeling the pinch from German rivals Aldi and Lidl.

They've succeeded in retaining customers they attracted during the downturn, and the pair now have a combined market share in Ireland of 16.8pc.

Dunnes Stores has been targeted in the past number of weeks by workers seeking better conditions and visibility over working hours. Dunnes staff who are members of trade union Mandate staged a one-day strike last month.

This week, Dunnes Stores told staff that it plans to grant a 3pc pay rise. That means workers will have received a total 9pc pay rise in the past three years.

Mandate has insisted that its fight with Dunnes Stores for improvements to workers' terms will continue.

Irish Independent

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