Temu, Shein busted: Kmart drops major plan

Daily Telegraph

7 days ago

Kmart has unveiled its war-footing plan as it bids to fight back against online giants Temu and Shein and Canadian upstart Dollarama in the battle for wallets of Aussie consumers.
Newly installed Kmart Group Managing Director Aleks Spaseska has revealed the retail giant's aim to grow to $20 billion in turnover as it expands in the face of increasing competition from massive overseas outlets.
Long-time competitor Big W is struggling but Temu and Shein have joined Amazon and eBay as chief competitors to Kmart's market share. While big money Canadian discount retail store Dollarama's take over of The Reject Shop will present even more commercial challenges.
At the heart of Kmart's plan is expanding its popular cut price home brand Anko but also on completely reworking the retail experience for its millions and millions of Aussie customers.
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Kmart have begun experimenting with new layouts in their stores, that bring clothing and beauty to the front of the outlets, aiming to maximise sales and turn younger customers into lifelong shoppers.
The retail giant wants to expands it offerings in women's, men's and youth clothing ranges and beauty products, toys and electronics.
'The biggest difference you'll notice is in the apparel and beauty offer in the store,' Spaseska told the SMH.
'If you go into women's apparel today, you'll see we mostly sell all the tops together, the bottoms together, the dresses together.
'If you think about the way our merchants put the ranges together, it's a brand-new outfit
'When you walk the store in the new format, there's much more co-ordination through women's apparel, which allows customers to be much more inspired and helps with outfit building.
'We've also brought beauty to the front of the store as well.'
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Kmart's Mount Gravatt store in southern Brisbane was the first to be refurbished in the new format late last year.
According to Spaseska, it is already bringing results with customers buying more items than average.
Four more stores are set to follow suit next month and if that rollout is successful, every Kmart store will be refurbished in the new style.
'Those results have been stronger sales, particularly in apparel, and really pleasingly, we're seeing customers because of changes to the flow of the store, shop much more,' Spaseska said.
Bigger items such as bikes and car seats will be moved off the floor room to the store rooms in stores, where customers can 'click and collect'via online, in order to make more room for clothing and beauty products.
Kmart is also opening a $200m new distribution centre in Sydney's west.
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Kmart has continued to do well despite the cost of living crisis, with its competitive prices on items such as $15 rice cookers.
Last year Kmart beat its sales target of $10bn. Spaseska is confident Kmart will continue to do well when the economic environment improves and aims to reach $20bn in earnings over the next 10 years.
'What we can see is that Kmart is really a brand for everyone, so we've got very good levels of engagement across all customer demographics and across all levels, and they're spending with us, and we're seeing growth across all of those customer cohorts,' she told The Australian.
'The other thing I would say is, I think once customers come and they discover the product offer, the extent that they have additional disposable income in the future, there's lots of different ways to spend that, and that's what we're seeing.'
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