Retail giant Kmart is set to open a huge new store while its biggest rivals struggle to survive the ongoing coronavirus pandemic, with footfall in malls increasingly low.
The popular discount store chain has been confirmed as one of the major tenants at a new $70million ‘super-neighbourhood’ shopping centre being built west of Brisbane.
The 50-store Yamanto Central development currently under construction near Ipswich with stage one earmarked to open early next year.
While Kmart remained profitable in deteriorating trading conditions, its sister department store Target suffered a worse-than-expected $67million slump.
Kmart is set to increase its retail presence by opening more stores (pictured, a store in Perth)
Kmart has become renowned for its cheap and trendy homewares, including toasters for just $7.50 and coffee tables for just $29.
Meanwhile, the coronavirus pandemic has only hastened the closure of dozens of other Australian shopping stalwarts, including Target and David Jones.
Parent company Wesfarmers recently announced that 75 Target stores will close while 92 others will be transformed into Kmarts.
Now Kmart and supermarket Coles will be among the first tenants when the JMK Retail-owned Yamanto Central opens its doors to shoppers in early 2021.
‘It’s everything that you need,’ JMK Retail general manager Vicki Leavy told the Courier Mail.
‘It’s been designed to be shopped quickly or slowly.’
Kmart will be one of the major tenants when Yamanto Central (pictured, in plans) opens near Brisbane
Ms Leavy has noticed unprecedented demand for suburban shopping centres during through the recent pandemic, with less shoppers willing to go into CBDs.
He also explained there had been an ‘incredible’ level of prospective tenants seeking to open new stores in malls.
‘The local centres are certainly maintaining that level of activity,’ she said.
In February, Kmart swung to a 5.5 per cent first-half comparable sales growth from a 0.6 per cent decline a year ago.
Revenue at the discount department store is up $241million, or 7.6 per cent, to $4.99billion.
Many stuggling Targets stores will be transformed into Kmarts (pictured, a quiet Sydney store during the recent coronavirus pandemic)
Meanwhile, Target’s sales went the other way, though, falling 2.3 per cent compared with 0.5 per cent growth a year ago as it recorded a worse-than-expected $67million sales slump.
The sharp decline fast-tracked a review into the commercial viability of the struggling retailer.
Meanwhile, David Jones is set to shut down some of its 48 department stores due to suffering $464million in debt following a loss of sales.
Household names including Harris Scarfe, Bardot, Roger David, and Napoleon Perdis also dropped like flies in the past year with dozens of stores closing resulting in heavy job losses.
Wesfarmers has since confirmed that ten to 25 large Target stores will be closed, alongside 50 smaller Target Country stores.
Kmart will be among the first stores when Yamanto Central (pictured) opens its doors in early 2021
An additional 25 regional Target Country stores will be converted into small Kmarts, while between ten and 40 large stores will become big Kmarts.
‘The strategic review is considering all options for the Target business including an accelerated store closure program, the conversion of some stores to Kmart and other structural options for the Target business,’ Mr Scott told Daily Mail Australia in a statement in April.
‘The review is an opportunity to review the network, the number and size of stores, to ensure it is fit for purpose.’
Target staff will be offered jobs at Kmart or other Wesfarmers companies, including Bunnings and Officeworks.
The changes will be implemented over the next 12 months, with most of the work to rebrand stores being carried out in 2021.
TARGET STORES CONVERTED TO KMART STORES
Bega, early-mid 2021
Bowral, early 2021
Gunnedah, early 2021
Katoomba, early 2021
Moree, early 2021
Mudgee, early 2021
Picton, early 2021
Tumut, early 2021
Ulladulla, early 2021
Windsor Town S/C, early 2021
Yass, early 2021
Ayr, early-mid 2021
Beerwah, early-mid 2021
Bowen, early 2021
Charters Towers, early 2021
Chinchilla, early 2021
Dalby, early 2021
Gatton, early 2021
Goondiwindi, early 2021
Gympie, early 2021
Ingham, early 2021
Mareeba, early 2021
Noosa Junction, early 2021
Ocean Shores Village Ctr, early 2021
Port Douglas, early 2021
Roma, early 2021
Sarina, early 2021
Stanthorpe, early 2021
Warwick, early 2021
Yamba, early 2021
Yeppoon, early 2021
Ararat, early-mid 2021
Castlemaine, September 2020
Cobram, July 2020
Echuca, July 2020
Hamilton, early 2021
Kyabram, September 2020
Lakes Entrance, early 2021
Leongatha, early 2021
Mansfield, early 2021
Portland, early 2021
Seymour, early 2021
Woodend, September 2020
Yarrawonga, early 2021
Berri, early 2021
Murray Bridge, early 2021
Port Augusta, early 2021
Victor Harbour, early 2021
Esperance, early 2021
Geraldton, early-mid 2021
Northam, early 2021
Pinjarra, early 2021
Katherine, early 2021
Mr Scott recently revealed more Kmart stores could help increase overall foot traffic into shopping malls and centres.
‘To convert stores costs money and there are some stores that are not commercially viable in the current structure,’ he told the Australian Financial Review.
‘In some cases it’s better to close stores than to keep pursuing unviable stores.
‘The opportunity is to work out how we jointly share the costs and share the benefits.’
Established in 1969, Kmart has expanded to 209 stores across Australia and 25 in New Zealand
Target is Australia’s largest department store chain with 284 stores across the country.
Established in 1926, the retailer was originally known as Lindsays until 1968, when Myer Emporium bought the chain of 16 stores across Victoria, which were renamed Lindsay’s Target.
The retailer was renamed Target Australia in 1973.
Kmart opened Australia’s first discount department store in Burwood, Victoria in 1969, attracting an estimated 40,000 shoppers on opening day.
The chain expanded to 209 stores across the country and 25 in New Zealand.