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Warehouse pledges online transformation to survive digital threats such as Amazon

Amazon has been a driving factor in The Warehouse's digital transformation, chairwoman Joan Withers and group chief executive Nick Grayston told shareholders at its annual meeting in Auckland today.

"We are going through a period of change unprecedented in the company's history and we believe that we will be in good shape to compete with the likes of Amazon," Withers said.

"The Warehouse is undergoing a fundamental transformation, specifically to ensure that it remains relevant and competitive in the future."

The retailer's share price has fallen by around 30 per cent in a year, with its stock last trading at $2.04, down from $3 last year.

Withers said the company's decline in market share was a serious concern.

"Globally, retailers are besieged and only those who are the fittest and who have made the changes needed to compete for today's customers are successful."

Against a backdrop where more than $2 billion was wiped off the value of ASX listed retailers in the month following the announcement of Amazon's arrival in Australia, both the board and management team recognised that business as usual or incremental change was not an option, she said.

Under the leadership of Grayston, who took over from Mark Powell in December 2015, The Warehouse has embarked on a three-year strategy to lift profitability by removing the complexity and cost of an inefficient operating model and reshaping the company's physical footprint to support the digital business.

Grayston acknowledged 2017 had been a challenging year for the retailer, but said he was confident it was well-placed to bounce back.

"As a major retailer facing a rapidly changing competitive consumer landscape, the challenges are far from over," Grayston said.

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