Wesfarmers says market share of Coles supermarket lagged behind in the 2009-10 fiscal year and more work was required to make a successful recovery.

Richard Goyder, chief executive of Wesfarmers, said the firm was about to begin the second stage of its turnaround plan of five years for Coles. He added that there are lots of chances for the supermarket to push through with its improvement that is "way beyond the five year timeframe".

"Over the year, our market share has been pretty flat because we've actuall

y sold some stores to Foodworks and we haven't opened a whole lot of new stores, maybe 10," the Westfarmers CEO said in a teleconference on Monday.

Mr. Goyder asserted that the company was "very much on track" with its recovery plan for Coles, with its liquor arm, Officeworks and Kmart "both operationally and financially".

"There's a lot we need to do," he stated.

"We need to continue to build the network and that will be opening new stores and refurbishing our existing fleet of stores.

"There are currently around 760 stores so there's a heck of a lot of work to be done there."

"(We are) continuing to improve the fresh offer on all fronts, that's produce, meat, deli and bakery and the like.

"There's been an enormous amount of work to improve the capability of the management team and the teams in stores.

"That will continue.

"There has been a strong focus on supply chain and we've had promising early roll out of what we call easy ordering, which is auto replenishment and that will need to continue across pretty much the whole fleet.

"And in supply chain, there is also the work of reducing the number of distribution centres we've had.

"And then there is a whole lot of work to do across the business on waste and markdowns as well."

Mr. Goyder added he "not worried" at all when an adviser said the inflation levels and the price reductions of Coles was approaching very risky levels.

"We watch our margins closely," the Wesfarners chief executive said.

"Consumers are getting a better deal through better arrangements with our suppliers ... and I'm not worried about it."