Bunnings unveils online shopping — but there’s a catch

Bunnings Warehouse has unveiled plans to allow customers to shop online, ending a long-standing strategy of only selling products in its stores.

The announcement came the same week Amazon was tipped to launch in Australia — an event that has caused disquiet among domestic retailers and seen many rush to ramp up their online businesses.

From early 2018, Bunnings will join this growing number of online retailers.

But unlike the online businesses of department stores like Myer and its budget equivalent Kmart, as well as supermarkets Coles and Woolworths, Bunnings’ new service will not be a full e-commerce business.

Shoppers will only be able to buy Bunnings’ ‘special orders range’ online.

This range refers to 20,000 products that are not stocked in Bunnings stores. It includes bulky items such as sheds and children’s playgrounds, as well as an extended range of products like taps and fittings.

Currently, customers can only order these products in-store.

A spokesperson for Bunnings said home delivery would be available on all online purchases.

Despite its limited nature, the move to online retail marked a major strategic shift for Bunnings — a highly profitable business that has become the jewel in parent company Wesfarmers’ crown without ever venturing into e-commerce.

Announcing the move, Bunnings managing director Michael Schneider appeared to downplay its significance, and made no mention of Amazon.

“We continue to evolve our digital offer, and from early 2018 customers will be able to purchase our special orders range online,” he said.

“This will give customers more convenient access to thousands of products from our suppliers that are currently only available to order in-store.”

Nevertheless, the timing of the announcement was noteworthy.

On Thursday, US e-commerce giant Amazon began trading in Australia with a “soft launch”, reportedly only selling to a select group of customers, ahead of its expected full launch.

While Amazon’s arrival in Australia has been tipped to hit retailers of clothes, sports equipment and electronics the hardest, home improvements specialists like Bunnings are far from immune.

In the UK, where Amazon is well established, shoppers can purchase a huge range of home improvement items online, from power tools to paint to kitchen sinks.

Bunnings’ recent foray into the UK market has so far not been a success – though there is no indication this has anything to do with Amazon.

Dr Louise Grimmer, a retail expert at the University of Tasmania, said Amazon’s arrival in Australia would “probably” impact Bunnings, pointing out that Amazon had its own private label range of household and garden products.

She added this competition would increase if the 500 third party sellers already signed up to trade on Amazon Marketplace included home improvement product providers.

“Bunnings have been really slow to get on the e-commerce bandwagon, and now they’re scrambling to get there,” Dr Grimmer told The New Daily.

She called Bunnings a “category killer” that had “killed off all the mum and pop hardware stores in Australia”.

She said competition from another colossus like Amazon was therefore not necessarily a bad thing.

This article was first published by The New Daily. You can read it here.