Wesfarmers to close money-losing e-commerce website | Enterprise & Market Information
Wesfarmers says it’s going to close down catch.com.au, the money-losing e-commerce website it purchased for $230 million in 2019.
Catch’s warehouses can be transferred to KMart Group, and a few of its digital capabilities can be transferred to Wesfarmers’ retail divisions.
Catch incurred a $96 million loss in 2023/24, an enchancment on the $163 million it misplaced the 12 months earlier than. However its income dropped 36 per cent to $227 million.
For the half-year to December 31, it’s anticipated to declare a loss of between $38 million to $40 million, Wesfarmers stated on Tuesday.
“The recent increase in competitive intensity in the Australian e-commerce sector has affected Catch’s financial performance and growth prospects,” Wesfarmers managing director Rob Scott stated.
The group’s current retail and health companies – which embrace Kmart, Goal, Bunnings, Officeworks and Priceline pharmacy – are higher positioned to reply to evolving buyer expectations, he stated.
“These businesses are supported by extensive store networks, leading e-commerce platforms,the Group’s shared data asset and complementary loyalty and membership programs, including OnePass,” he stated.
Wesfarmers additionally stated on Tuesday it could develop a retail media community with shared capabilities throughout these companies.
It didn’t present particulars, however retail media means point-of-sale promoting, such because the extremely profitable show screen promoting business in Woolworths shops and the third-party ads in e-commerce apps reminiscent of Amazon Procuring.
Wesfarmers stated Catch would shut down during the fourth quarter of 2024/25.
Its order fulfilment centres in Moorebank, NSW and Truganina, Victoria – that are solely working at about half-capacity – can be transferred to KMart Group, which might use them them to take strain off its busy shops.
Mr Scott stated that whereas Catch’s financial efficiency had been difficult, it had taught Wesfarmers’ beneficial insights that had accelerated the group’s digital transformation.
Wesfarmers will spend between $50 million and $60 million shutting Catch down.
The place potential, Catch Group workers can be provided alternatives elsewhere at Wesfarmers, the company stated.
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