Kmart Could Soon Be Wiped Out By US Giant Superstore

It looks like the massive American retail giant, Walmart could be coming to Australia in a move that may wipe out our local chains, according to retail experts.

Millionaire businessman Dick Smith predicts that Walmart could take over Australia’s Kmart department store chain within five years, as reported in the Daily Mail.

The Dick Smith Electronics chain founder said that the world’s largest retailer could make an offer to purchase Kmart from its Perth-based parent company Wesfarmers.

‘They’ll take Kmart, that will go first, in the next four or five years,’ he told Daily Mail Australia.

This speculation follows the merger of Walmart’s U.K. subsidiary Asda with Sainsbury’s, which effectively freed up capital for them to invest in a new market.

Walmart Eyeing Coles For Takeover

It has also been suggested that Walmart may also be eyeing Coles as the platform to enter the Australian market. This follows Westfarmers intention to demerge Coles and float in on the Australian Securities Exchange as a separate company.

What Is Walmart?

Walmart is an American retail chain specialising in discount department and grocery stores. It is famous for selling a massive variety of merchandise and has a catalogue of over 120,000 different products.

This includes the weird and wonderful from bacon-scented pillows and pickle-flavoured ice blocks, powdered peanut butter and jelly bean-flavoured milk to peanut butter and jam sandwiches in cans. Walmart also sells firearms, which won’t be permitted locally.

Kmart Staff Could Be In Trouble

Dick Smith predicted that Walmart’s first move within Australia would be a drastic cost-cutting exercise.

Smith said Walmart may sack Australian Kmart staff and offer cheaper prices by retrenching staff.

‘Walmart, they are completely ruthless,’ he said.

‘The Walmart formula is sack people. Don’t share the wealth, sack people.

‘That’s what they’ll do here.’

It’s A Rumour But Could Happen

CMC chief markets strategist Michael McCarthy said Wesfarmers would happily offload Kmart to Walmart, even though sales volumes increased by eight per cent during the last financial year.

‘That’s strictly in the rumour category but nonetheless, we couldn’t rule it out,’ he told Daily Mail Australia.

‘This is their sort of business.

‘Both Wesfarmers and Wesfarmers shareholders would be delighted if they find a buyer for Kmart – the variety store format has been under pressure for an extended period and a graceful exit from Kmart would be applauded.’

McCarthy said that while Walmart wasn’t a groceries specialist, Coles would be a better Australian buy than Kmart.

‘The steady earnings that come from the grocery business are attractive to a number of global investors,’ he said.

‘It’s a little removed from Walmart’s main business but a pure grocery play in the global context does make more sense for a group like Walmart.’

A Complete Shakeup Of Australia’s Retail Scene

Dick Smith further predicted that Walmart would later make a bid for either Coles or Woolworths, which bought out his now defunct electronics chain in 1982.

‘Walmart will come and take over either Coles or Woolworths and then Aldi will take over the other,’ he said.

No Confirmation Yet

Walmart has not made any announcement about buying Kmart, Coles or Woolworths.

Wesfarmers by law would be required to disclose such an offer to the Australian Securities Exchange.

Wesfarmers managing director Rob Scott said he has ‘no awareness’ of Walmart looking to buy Coles or Kmart.

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25 Comments

- - meedee said
  - 23 Oct 2022
    9:28 am
I guess covid stopped them as they still arnt here.

- - Blossom said
  - 01 Sep 2018
    7:54 pm
You need to know your prices you normally pay. e.g. some things are cheaper at Costco, some aren’t and a few are more expensive. Don’t forget you need to pay a membership fee to Costco and you need to take that into consideration. Is it worth the extra km you have to travel to one?? Their fuel (members only) is cheaper than other cheap fuel outlets. I think Target is going to struggle too.

- - tessie said
  - 30 Aug 2018
    1:51 am
If they do buy it out, not only could jobs be lost but the profits will go back overseas and not stay in Australia. Here’s hoping it doesn’t happen.

- - sars_angelchik said
  - 22 Aug 2018
    2:14 pm
I think this would be a great thing- if it means that we get cheaper prices and not more expensive prices aimed at an Australian market who already pay more than the rest of the world for everything. Our retail sector needs a shake up!

- - rovermum said
  - 22 Aug 2018
    9:12 am
Interesting to see how this plays out. It would be a shame for jobs to be lost, and do we really need more Costco-type stores? Let’s see.

- - mom74005 said
  - 21 Aug 2018
    8:51 pm
Wow, big call. Let’s see how things play out.

- - rachel1970 said
  - 21 Aug 2018
    7:32 pm
why change Australia to be like America?

- - ella12 said
  - 21 Aug 2018
    3:50 pm
I hope this does not happen, no, no, no.

- - Ellen said
  - 21 Aug 2018
    7:40 am
Why are American retail giants uberhaupt welcomed in Australia ? Not a good thing I think !

- - mom311699 said
  - 21 Aug 2018
    7:05 am
Why can’t Australia stay the same I don’t understand why everyone wants to make Australia like America America is America and Australia is Australia

- - mom316799 said
  - 21 Aug 2018
    6:48 am
If this does happen it better be like Kmart . Cheap prices and in a lot of places just like Kmart is now or they won’t be seeing me in their store.

- - Michelle Jayne said
  - 21 Aug 2018
    6:11 am
Speculation by a man whose major retail company went out of business. If he was that good at speculating, he never would have lost his business.

- - Lizzie23 said
  - 21 Aug 2018
    12:26 am
Nooooo I love Kmart.

- - mom68673 said
  - 20 Aug 2018
    11:08 pm
This doesnt come as a surprise.
I doubt it would be exactly like walmart in the US.
As Australia has different laws eg no guns or bullets would be sold due to our laws.
I think it would be great for the community to have a centre that stocks everything.
- mom93821 replied
  
  21 Aug 2018 , 6:54 am
  Our laws and controls are quite different – so it would be different for sure – if it does occur?
- - Aussieladee said
  - 20 Aug 2018
    10:35 pm
KMart needs a shake up. Their store design means that the disabled have a lot of problems accessing it & it is always untidy/cluttered. I gave up trying to shop in KMart because of their horrible store design forcing shoppers to go through a maze to pay for the items. Definitely not wheelchair friendly, bring on Walmart!

- - youngoldlady said
  - 20 Aug 2018
    9:54 pm
I for one hope it never happens here. The image Walmart has in the USA is not a good one. I hope that the places here are taken over by Australian companies who respect our way of life.

- - ashna9 said
  - 20 Aug 2018
    7:58 pm
I love Kmart but I can’t wait for Walmart either!
- mom173432 replied
  
  20 Aug 2018 , 8:27 pm
  Kmart in USA came out of SS Kresge in Detroit Michigan who was a Dime and Ten variety store for decades like Coles “nothing over 2/6(25cents)” motto. They came to Australia and Coles had 50% o that Australia enterprise until bad things were happening in USA and Kmart went bust and another group bought it out. Coles bought the balance of Kmart and kept the name in Australia. Kmart and Target once competed in sales in a silly way even though they were owned by the same. Target evolved out of Lindsay’s from Geelong(Norlane) am Myer bought them out and adopted Target and the bullseye as used by the US Target owned by a major retailer in US Mid-West. Westfarmers talked of closing Kmart down and now the talk is about Target. BigW is always in Woolworths sights to close it down. I was in USA in the mid-1970s when the oil quadrupling most of the cheaper variety stores down the drain. Some like Kmart survived as did Mobil Oil’s Montgomery Ward chain. There was a supermarket revamp too, some disappearing and others merging after a Detroit experiment in 24 hour supermarkets. Walmart have had financial troubles in USA and many stores have gone under(in USA a company can call up the chief in a state and tell him to close all the state’s branches at 5pm and then they pull out of that state, I have seen it happen). Products like DVDs and CDs are disappearing in Walmart stores and Kmart here are doing the same currently. It would be a shame if Coles or Woolworths were sold out and were no longer 100% Australian. We are 100% unique in the world with having the two major supermarkets owned by Australians. The government should do something to stop it, but will they? Woolworths were to be called Walworths when they were being devised with Theodore Kelly as chief and when they discovered US FW Woolworth Variety Stores were not coming here they adopted the name. FWW was also a force in UK and now that firm is gone in both UK and USA but our Woolworths as grocers is still going strong. Many will remember when many suburbs has Woolworth & Coles Variety Stores side by side and branches in the heart of the cities such as three Coles in the centre of Melbourne.
- - mom90758 said
  - 20 Aug 2018
    1:53 pm
I guess we will have to wait and see. I love Kmart so I hope it won’t disappear.

- - mom294977 said
  - 20 Aug 2018
    9:50 am
I wonder if it would really matter. People just don’t like change and I am sure in time people will adapt. If the products are good and prices are low does it really matter? I think people said that about IKEA and COSTCO when they first came out. Australia has a habit of giving away everything.

- - mom93821 said
  - 20 Aug 2018
    5:51 am
Speculation and rumour – let’s see what happens.