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Coles in major bakeries roll out

Coles-john-durkanColes wants to be famous for its fresh bread and will aggressively roll out more in-house bakeries, the supermarket giant’s managing director John Durkan has told investors.

Durkan says plans are underway to convert an additional 180 stores to include bakeries as Coles works toward offering freshly baked bread at every store.

“I want Coles to be famous for its fresh bread,” he told analysts and investors at Wesfarmers’ strategy day on Wednesday.

Durkan said Coles was focused on increasing its fresh produce and reducing the range of some products to make it simpler for the customer.

He said the supermarket had had a rise in pasta sauce and garbage bag sales after it recently shrank the range in both categories.

“We have moved eight lines out of our garbage bag category, which was 20 per cent of the items in that category, and in response, sales have increased by five per cent,” he said.

He said Coles also narrowed its pasta sauce range, removing about 17 per cent, and again there was a lift in sales.

The move to fresher goods, made in-store is reflective of the changes in what Australians are buying at the checkout and how these are impacting supply chain arrangements significantly, and tilting profits to producers of higher quality and more healthy foods – and away from retailers.

Coles’ in-house bakery play also echoes that of rival supermarket chain, Woolworths, who’s latest format stores includes in-house bakeries, in-store sushi section, cheese room  and a dedicated butcher.

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