The Retail Hotlist: Chemist Warehouse takes out 'Hottest market entry'

  • News
  • August 2, 2018
  • Caitlin Salter
The Retail Hotlist: Chemist Warehouse takes out 'Hottest market entry'
Nominees: Vinomofo, H&M Home, Krispy Kreme, GoodFor, Chemist Warehouse, Thankyou.

People’s choice
Krispy Kreme

Judges’ choice
Chemist Warehouse

Australia’s largest pharmacy chain, Chemist Warehouse, set its sights on New Zealand in the middle of last year, bringing with it the promise of unbeatable low prices. The company stepped up its marketing in January after settling into its first Auckland store at the end of December. Kiwi’s love of a bargain saw the Chemist Warehouse find a quick target audience, with special deals on fragrance, supplements and beauty items proving a serious drawcard for consumers.

The Auckland store is the brand’s first. Over in Australia, the 400-store chain employs over 8,000 staff members.

Just six months after Chemist Warehouse opened its Mt Albert store, a second outlet in Botany opened to the public in April. A third outlet in Manukau Westfield is currently under construction. Azman Haroon, pharmacist and director of Chemist Warehouse New Zealand, says the launch into the New Zealand market has exceeded expectations.  

“So far it’s been very well received and our customers have been really excited with our stores. The fact that New Zealanders were familiar with our brand from visiting or having family in Australia meant they knew what to expect. They see our prices, range and great service as a positive in the New Zealand market.”

While the chain is expanding quickly around Auckland, so far there are no plans to look to other New Zealand centres. Chemist Warehouse entered the market with the promise to open 10 stores in Auckland within the first year and Haroon says they are on track to fulfill that promise. Haroon owns and operates the first two franchises himself and is focusing on making sure he doesn’t overpromise and under deliver. 

“At the end of the day we are a pharmacy and as pharmacists we have to keep that professional stance on our business. Auckland is a big place and we’re learning a lot as we grow but we want to make sure we get everything right here before we consider looking elsewhere.”

Haroon says while there are few differences in retailing and consumer-base between Australia and New Zealand, there is a stark difference when it comes to the level of competition in Australia - which pushes pricing down across the board. The high cost of healthcare in New Zealand has provided Chemist Warehouse with the opportunity to provide considerable savings.

“Pharmacies in New Zealand have very high prices so I think we’ve entered the market at the right time to make a difference in people’s lives and hopefully some really big savings.”

Chemist Warehouse promises customers zero prescription fees on subsidised medicines (usually $5) and prices up to 90 percent cheaper than other pharmacies.

But Haroon says he realises savings are just one part of the shopping experience and wants to ensure the Chemist Warehouse offering is what people are looking for. He aims to focus on great customer service and stock range to build a good reputation in New Zealand. 

Judges’ comments from Scott Fisher: New to the New Zealand market The Chemist Warehouse’s recent entry will undoubtedly redefine this broad category with its promise of unbeatable low prices.  Against a backdrop of intense competition, the New Zealand consumer will certainly embrace the format like their Australian cousins.

This story originally appeared in NZ Retail magazine issue 756 June/July 2018

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