Lew would restore Coles discount card
Solomon Lew has opened his campaign for re-election to the Coles Myer board by vowing to reinstate the shareholders' discount card. Mr Lew, who has been a director for 17 years, introduced the card in 1993 and says he's committed to its reintroduction, as it's “good for shareholders and good for business”. Mr Lew is currently fighting a move by eight of the other nine directors to vote him off the board at the company's AGM on November 20.
However, the discount card scheme has been blamed for the under-representation of institutional shareholders on Coles Myer's register, with mum and dad investors numbering 580,000, or 38 per cent, by 2001. The retailer now has around 560,000 investors, but 425,000 of those still only hold between 500 and 1,000 shares, with another 100,000 holding between 1,000 and 5,000.
CEO John Fletcher announced in March that the company would axe the card and save $170 million. In return the retailer would lower store prices and introduce incentives for the Fly Buys and Coles Myer credit card. Mr Fletcher wants a full range of loyalty programs to be in place before the second round of cuts occurs on the discount card, probably on July 31, 2003. Coles Myer is also believed on the point of implementing a discount petrol retailing scheme, under which supermarket shoppers would be given tickets to use at petrol stations.