Australian retailer Myer is spending $9 million on a new Web site in a drive to become the country's largest online department store. Myer hopes to generate up to $40 million in annual sales from the new portal.

Chief executive Bernie Brookes said the first version of the new site would be launched in November, and more functionalities would be added in February, including "superdeals" and private shopping club services.

The retailer generates a million hits monthly on its current Web site, but Brookes said Myer expects to boost its $5 million sales. The new site will offer up to 250,000 items, up from the current 4,500 products.

"It will be a site that we'll be very proud of, coming from a site that I would describe at the moment as average," Brookes told The Wall Street Journal.

Brookes said the site would help save Myer money on rent, which consumes up to 8 per cent of the retailer's income, as well as labor costs, which account for 20 per cent.

Myer has 67 stores which gives the retail chain an advantage over competitors with an online presence only. Brookes added it has a ready-made customer base of 1.8 million shoppers who are members of the store's Myer One loyalty card program.

Myer's model are foreign retailers Macy's in the U.S. and Debenhams in Britain, which are reaping billions of dollars in sales due to its strong online presence. Brookes will oversee the implementation of the new online presence as part of Myer's restructuring of its executive team after the resignation of Penny Winn, executive general manager for merchandise.

Australian retailers have previously blamed weak sales on the high Australian currency and competition from overseas Web sites that do not charge buyers from Australia the general sales tax for items below $1,000.

On Thursday, e-tailer ASOS rolled out an Australian site following similar launches by Topshop and Zara. ASOS is known for its designer looks at low prices and free shipping. It was launched in 2000 and grosses $531 million in yearly sales.

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