Wesfarmers’ retail crown jewel Kmart is extending its reach, with stablemate Target to be officially folded into it and becoming a multi-billion dollar business.
Target managing director Richard Pearson is to take up a new position in Wesfarmers’ new health division — spearheaded by recent acquisition Priceline — with Kmart managing director Ian Bailey to lead the combined group.
Support offices are being “internally reorganised” but the separate brands will be maintained.
Mr Bailey said the announcements were largely around streamlining back-end operations and customers and the group’s 50,000 staff would see no difference.
“With customers now demanding value more than ever, this new operating model will unlock a new level of scale and productivity across both brands, so we can deliver even greater value to our customers in the future,” he said.
“There are no impacts to the Kmart or Target stores.”
Efficiencies are being made in technology and back-office functions, with processes to run the $10 billion business being streamlined.
Target has long been in flux, with a wide-ranging and difficult store rationalisation program cutting the number in WA to 12 down from 30 in 2019. It became a division of Kmart Group within Wesfarmers in 2017.