Thinking outside the box

The design of Magnet Mart in Gungahlin, Canberra, was influenced by the best features of hardware stores across the world — an Australian store with international heritage…

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Store: Magnet Mart, Gungahlin, ACT
Owner: Donaghue family
Group: Magnet Mart
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Magnet Mart Home Improvement Warehouse, comprising seven stores in the ACT and southern NSW region, is a family-owned group of hardware outlets with its own private agenda for success.

Paul and Chris Donaghue outside the Gungahlin store

The 13,500m2 flagship store in Gungahlin was built from a clear site in 2002 and is a fascinating example of what can be achieved through independent and unfettered planning ideals.

Owners, the Donaghue family, built the store as part of a growth policy stretching back to their first store opening in 1972. Think of the Gungahlin store as the family’s version of the Rockefeller Center: a massive and bold structure built on the strength of many decades of hard work.

The store has already won many industry awards

The Gungahlin complex has already won industry acclaim, winning numerous awards including NSW Hardware Industry Association and TABMA Awards in 2002–03. “We wanted a certain type of footprint,” says Magnet Mart Chairman, Paul Donaghue, explaining that the Gungahlin store was his group’s first foray into a “big box” format. “We went overseas and visited Germany, England and the USA, mainly to look at planning and merchandising concepts. When you go to many of these centres, so much is modelled on the Home Depot plan, and it would have been very easy for us to copy that, but we came up with something that suited us individually. Basically, new age hardware is meant to attract both male and female, and we saw that approach in a couple of stores in Germany.”

Two halves
The result at Gungahlin is a large store divided into two distinct sections; in one half of the store there are the “traditional” hardware lines, designed to appeal to mainstream builders and DIYers wanting to tackle straightforward building and renovation tasks.

Urban building growth is serviced with a packed timber yard

“The other half is more for the décor and softer lines,” says Paul, who works closely with his son Chris to make sure the balance is just right — clients in both halves must be mutually comfortable with the stock selections and presentations.

“I don’t say we’ve got it 100% right,” says Paul, “but the current design on the floor makes it easy to shop, with logical formats and department layouts.”

Upon entering the store, shoppers are confronted by a main central corridor from which emanate clearly identified tributary aisles. The overall vista is open and well sign-posted so shoppers do not develop a sense of being “encased” within a specific department.

In the 18 months since the store opened, a client base has settled into place comprising 85% consumers and 15% trade customers, though Paul and Chris say they would like to increase trade custom.

Dominant departments are Garden, Paint/Door Furniture and Building Materials, while popular segments at the moment include storage items. A Garden Artistry section has also been extremely well received, serving to inspire customers with decorator ideas and providing a helpful link to bigger Garden lines.

Customers are inspired to consider a range of new ideas

Another interesting innovation relates to displays of top-end goods in the Building Materials category. While some rival stores have expensive and spacious static displays of bathroom and kitchen set-ups, the Gungahlin outlet has template displays that can be used to highlight multiple door, bench and counter configurations.

“In the kitchen you can mix and match from a selection of 60 doors and 18 different bench tops,” says Paul, “which means you can experiment with 1,000 separate combinations of products.”

Stock selection, of course, is a cornerstone feature of any store, and is particularly crucial when the outlet is independent and able to control its full ranges. Seven experienced buyers are continually assessing and scrutinising new lines, however Paul argues that a broad selection of products representing a small number of key brands is less confusing for shoppers. “It’s a headache, but it’s a great type of headache to have,” he says, indicating that successful ranging is a rewarding component of the business.

Promotion and growth
While promotions and advertising are handled by the group’s own communications department, there is a constant drive to remind locals that the store is price-competitive, up-to-date and able to match or surpass the service offerings of other “big box” competitors.

The store’s tool shed displays are expansive and ordered

A recent logo change, for example, featuring a strong chain discount store flavour, has helped formalise the group’s image as a coherent, trustworthy and specialised chain. Additional promotion is generated by the store staff themselves. According to Paul, his 130 employees (40% full-time) receive training in individual departments and are motivated to behave confidently and respectfully. It is always encouraging, explains Paul, too see young casual staff develop the skills to assist customers and deal with the public.

The sudden expansion into a large-format style at Gungahlin — with 40,000 SKUs — might have caused further logistical headaches, but Paul says a new computer program has been placed across all stores to monitor sales of individual lines and guide stock ordering. The system is simple, according to Paul, and has the advantage of being able to accommodate additional store inventories with ease.

And expansion is certainly on the cards. New stores will open over the coming year at Shellharbour and Griffith, both based on the Gungahlin design, and there are no impediments to group expansion over the long term.

By John Power