Kaufland Australia has revealed it’s spent $14milllion on hiring 123 staff, more than a year ahead of opening its first hypermarket here.
And seek.com shows the German company is on the hunt for a string of additional roles – including senior buyers for grocery and liquor – in Sydney, Brisbane and Adelaide, as well as Melbourne.
Documents lodged with the Australian Securities & Investments Commission have shown the staff costs, in addition to its income rising to $1.9million from $1million a year earlier, while its net loss rose to $25.9million from $4.8million.
In the top job is Julia Kern, who was appointed country manager last year. The 29-year-old took up the role in May 2018 and has been connecting with the Australian drinks industry as the supermarket and liquor chain gears up to launch in Australia.
Kern was previously executive director, Region North, for the retailer in Germany.
Former Woolworths and Metcash executive Mark Hewlett was hired last year as director of supply chain, logistics and sales. He returned to Australia in late 2018 after six months’ training in Germany.
Also on the executive team is Male Nousch, a former strategy director at British supermarket chain Tesco and previously an associate at McKinsey.
Construction begins on distribution centre
Last month, Kaufland Australia turned the first sod on its distribution centre in Mickleham, Victoria.
Vaughan Constructions won the contract to build Australia’s largest distribution centre.
Vaughan’s Senior Development Manager, Chris Telley, the facility will include more than 117,000 square metres of building area, over two stages with stage one comprising 98,700 square metres of building area and 107,210 square metres of concrete hardstand, along with 168 recessed loading docks and substantial temperature control areas.
“Kaufland were very mindful that the European climate, construction and building materials can be very different than those in Australia and were thus keen to partner with a builder with a sound track record in delivering quality facilities along with the requisite experience building state-of-the-art temperature control areas,’’ Telley said.
The facility, with a total projected investment of $255 million, will utilise state-of-the-art technologies across automation, sustainability and efficiency, and create 600 new jobs for the area.
In a joint sod turning ceremony, Kaufland Australia directors Maximilian Wiedmann and Patrick Bezner thanked Hume City Council for its work ensuring the distribution centre met all planning and approval requirements.
“We would like to thank everyone who has helped us achieve this exciting milestone. To Hume City Council and to Merrifield Business Park, we are very grateful and proud to be standing alongside you today,” Wiedmann said.
“Australia is one of the fastest growing regions in the world, and we are excited to grow with it. Our distribution centre will be the beating heart of our supply chain and will ensure we provide an uncompromising quality food store for our customers.”
Local fears regarding Kaufland’s arrival
According to The Sydney Morning Herald, the centre has sent “shivers through the country’s fiercely competitive $90 billion grocery sector”.
Meanwhile, German news site Stimme notes: “Neighbouring Mickleham’s planned logistics center is an Australian Government Quarantine Center to keep exotic diseases and vermin out of the country. This is likely to appeal to competitors, who repeatedly warn of the arrival of the fifth largest retailer in the world on the fifth continent.”
Kaufland Australia’s first three stores will be located in Victoria at Chirnside Park, Dandenong and Epping. The Chirnside Park site is next to a Dan Murphy’s liquor outlet.
An independent advisory panel gave the go-ahead to the application, despite numerous objections. A ‘Save Our Shops’ campaign run by local small businesses in Victoria – including IGA, FoodWorks and Friendly Grocer – claimed that Kaufland will “destroy” them.
In response, Kern said the company was “committed to working with local communities in an honest, transparent and fair way”.
“When the market grows, so will we, and so will our competitors,” she noted. “When a new player enters the retail market, it encourages everyone to raise the bar in terms of quality, service and choice.”
Kern thanked the Victorian Government and everyone who participated in the independent Advisory Panel process. She said the initial investment would create up to 1600 jobs and “stimulate much needed competition and consumer choice in Australia’s supermarket sector”.
Kaufland Australia supermarkets will have a total store area of 4000 square metres and will feature local, regional and international products at discount pricing. Each store will include a bakery, butcher and liquor areas.
Morgan Stanley estimates that based on Europe penetration, Australia could support as many as 295 Kaufland stores longer term and that its annual sales in Australia could hit more than $3billon from 56 stores within six years of its first store opening.