The Woolworths Group Ltd (ASX: WOW) share price is slightly up after it announced a new range of homeware products it will sell at its Australian supermarkets.
At the time of writing, shares in the consumer staples and retail giant are trading at $40.01 – up 0.54%. For context, the S&P/ASX 200 Index (ASX: XJO) is 0.03% higher.
Let's take a closer look at today's news.
Woolworths share price up amid new range launch
Woolworths today launched a new range of home and office accessories in a bid to ramp up sales in non-perishable and non-food divisions.
The new inventory includes bedding, towels, and home office supplies, with prices starting from $10.
The supermarket is taking on Kmart, owned by Wesfarmers Ltd (ASX: WES), a market leader for home products in the value price range. According to a 2019 Roy Morgan poll, 1-in-5 shoppers went to Kmart for their home product needs and a further 5.6% shopped at Target — a brand also under the Wesfarmers umbrella. Since this poll, a number of Target stores have been rebranded as Kmart.
In contrast, Woolworths' rival brand Big W had only an 8.1% market share.
Big W, which represents Woolworths Group's homeware appliances business, has been underperforming against other divisions within the company. In its half-yearly update, Woolworths reported that Australian food generated more than $18 billion per square metre (psm), Endeavour drinks saw returns of about $21 billion psm, while Big W generated only $4.4 billion.
Management commentary
Woolworths general manager for non-food, James Hepworth, said:
With many Australians spending more time working from home, we know customers are looking for simple and affordable ways to improve their space.
Our new range features accessories that are perfect for a home office, with bed linens and towels made with eco-friendly materials. With spring just around the corner, this is a great way for customers to get organised to bring a fresh look and feel to their home for great value.
Woolworths share price snapshot
Over the past 12 months, the Woolworths share price has underperformed the ASX 200 by about 4 percentage points – rising 20% to the index's 24%. Year-to-date, however, it is overperforming the Australian benchmark by about 5.5 percentage points.
Woolworths has a market capitalisation of around $50.4 billion.
