Big W to shut 30 stores across Australia
Woolworths is set to close 30 Big W stores and two distribution centres Australia-wide as the impact of online retail continues to bite department stores.
In the latest blow for the retail industry, the retail giant on Monday announced 30 yet-to-be-revealed stores would shut their doors in a bid to keep the rest of the chain alive.
The stores will close over the next three years, while a warehouse in Monarto, southeast of Adelaide, will close in the 2021 financial year, and one in Warwick, Queensland, to follow in 2023.
Commercial Insights: Subscribe to receive the latest news and updates
The closures represent about 16% of the brand’s network of 183 stores nationally.
In announcement to the sharemarket, Woolworths says the move will mean a $370 million hit to the company’s profits, including $270 million in lease and exit costs, and $100 million in non-cash asset impairments, according to news.com.au.
Big W is set to close at least 30 of its 183 stores in Australia.
Woolworths chief executive Brad Banducci says the company will now begin negotiating with landlords to determine which stores make the most economic sense to close.
Because the store closures are yet to be determined, Banducci says he is unsure how many jobs will be affected.
“Our aspiration is to provide as many opportunities as we can for our team and that is what we intend working very hard on,” he says.
“There’s a lot of time for us to plan and engage with our team.”
Analysts were quick to predict more closures in the wake of the news, with bricks and mortar department stores again in the firing line in a challenging retail environment, with online retail continuing to grow in popularity.
Macquarie Wealth Management last month suggested Big W would need to shut 60 stores in order to slash the $2.9 billion in lease commitments it currently has.
