The Coles mega-briefing started at 9.30 and was still going strong as our deadline loomed but we have the company’s secret weapons for beating off the private equiteers: the world’s best plastic crate and sacking every third person in administration – 2,500 people to go over the next two years.

There’s also a strong picture being painted for retail growth across the business as well as the benefits of the company’s “transformation” plans, e.g. BI-LO stores are duds and will perform much better when re-branded as Coles.

The briefing itself is a monument to the focus a takeover bid can bring to a company – from a serious lack of information a couple of months ago, there’s an avalanche of detail to keep analysts busy, right down to the discovery that the average pet owner’s shopping basket is $15 more expensive than a non-pet owner’s each visit and that amount is growing, or that retailers are benefiting from the mini-baby boom Australia is experiencing. Cossie’s baby bonus is going to Coles where babies’ mums spend three times more in the supermarket than average shoppers.

But it’s the in-house designed black plastic crate and the sackings that really count in repelling the boarders, the “exciting new directions” chairman Rick Allert says the company is heading in. From the existing 7,555 people above store manager level, 1,750 will go this financial year and another 750 in FY 2008, giving annualised savings of $363 million that year and a 100 basis point reduction in the cost of doing business in FY09.

The black plastic crate holds more product in less space than the crates Woolworths use. Along with a better roll cage system, they will provide a net benefit of $98 million in FY08. When a company is spending $2 million a year on freight, every efficiency counts.

And that’s what Allert and CEO John Fletcher wants to convince shareholders about – that they can be as efficient and ruthless as the private equiteers and produce a company worth a lot more than the $17 billion or so that might be bid.

They reported a bottom line profit of $1.16 billion for the past year – $787 million after one-offs such as the Myer sale. But the transformation process – plastic crates, rebrandings and sackings – is predicted to produce a net profit after tax without one-offs of nearly $1 billion in FY07 with retail EBIT growth of 8 per cent.

The big carrot for FY08 is the promise of a business that would be generating net profit rate at the end of that year of $1.25 billion. And that would be worth a lot more than $14.50 a share.

John Fletcher said senior management is forgoing a portion of their base salary in return for bonus payments upon delivery of those FY08 target … gee, that sounds rather like what private equiteers do to give managers appropriate incentives.