The challenge

Australian big-box retailer Officeworks is transforming its stores with a focus on efficiency and growth. To facilitate this, they turned to Scalene to advise on the optimal product space for each store in its network. Our optimisation solution also addressed key challenges around estimating future product performance, strategic and operational constraints and the impact of store-level space changes by category.

The solution

Our unique space optimisation solutions allowed us to analyse and prepare all relevant and available store and customer data. We then made space elasticity assessments, applied business rules and configurations and incorporated strategic overlays to provide them with tailored store-specific space allocation recommendations.

Our recommendations also considered the space in store required to support Officeworks' strategic and operational goals. This involved identifying valuable space change opportunities aligned with Officeworks’ business strategy and objectives while also ensuring efficient and effective implementation of space changes in stores.

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The results

On implementing our recommendations across all stores in the network, Officeworks saw a net change in store sales and margin of more than seven percent. This equated to an incremental annual sales increase of +$45m and an incremental annual margin increase of +$21m. Adding to this, these strong initial benefits have laid a foundation for ongoing builds in performance over time and Officeworks is reporting stronger-than-expected growth through the post-implementation period.