Kmart, Target to create a $10b dual-brand discount retail giant

afr.com:

Wesfarmers’ Target is being folded into its discount stablemate Kmart, creating a singular $10 billion business with the aim of boosting returns as value offerings become more desirable to shoppers battling the rising cost of living.

A management rejig being outlined to staff on Monday afternoon will result in Target MD Richard Pearson moving to a new role within Wesfarmers’ health unit. Mr Pearson will become its retail director leading the strategy and operational side of the division, including its Priceline chain and loyalty program. Ian Bailey retains oversight of the enlarged Kmart group.

Kmart Group MD Ian Bailey is creating one business with two consumer-facing brands: Target and Kmart. 

Mr Bailey expects tougher economic times ahead for many Australians.

“I see value being really front and centre for a long time,” he said. “What we’re seeing is when we can consistently hit good products at great prices, then there’s plenty of demand out there.”

Kmart CEO John Gualtieri will run the combined Kmart and Target stores day-to-day. Other changes include group CFO Aleks Spaseska, who is taking on international supply chain, sourcing and property.

Arjun Puri will move his full attention to Kmart’s home brand, Anko, and head its international expansion push. Anko is selling direct to consumers in India and has a partnership with Canada’s Hudson Bay.

Kmart’s Brad Blyth will continue to lead technology as CIO, including Target’s migration to one set of systems as part of this change.

Mr Bailey said Target and Kmart would remain separate consumer-facing brands with no impact on retail floor staff and only a “handful of redundancies”, mostly in technology and merchandise, noting all changes would occur on the back end of the