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Struggling Australian retailer Target will close 75 of its stores, and convert 92 others into Kmarts, it has announced. 

Following a financial review, the company revealed plans to drastically restructure as the brand suffered a $67 million sales slump.

Ten to 25 large Target stores will be closed, alongside 50 smaller Target Country stores.

An additional 25 regional Target Country stores will be converted into small Kmarts, while between ten and 40 large stores will become big Kmarts. 

This means anywhere between 122 and 167 Target locations will either be converted or shut - which amounts to around half of Target's network of 284 stores. 

Announcing to investors on Friday morning, owners Wesfarmers said the restructure would reduce Target's 'unsustainable' cost base and allow it focus on the more-profitable Kmart. 






Target (pictured in Sydney) has announced the closure of up to 75 of its stores, with others being converted into Kmarts







The coronavirus outbreak meant many shops in Australia had to close for months, with less customers in the streets (pictured, shoppers in face masks in Sydney on May 17)


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, but details of which stores and closing and which are converting were not released.

The closures and conversions are likely to cost the company between $120 million and $170 million over the next year. 

A further $140 million will be used for one-off store conversion and stock clearance costs.

Wesfarmers chief Rob Scott said the company hopes to focus on its online sales.






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'The actions announced reflect our continued focus on investing in Kmart, a business with a compelling customer offer and strong competitive advantages,' he said.

'While also improving the viability of Target by addressing some of its structural challenges by simplifying the business model.

'While accounting standards require us to recognise an impairment of assets within Target to implement the restructuring, these actions will allow us to enhance the overall value of Kmart Group and further strengthen Kmart.' 






Target designer Dannii Minogue (pictured) is seen at the brand's fashion show during Melbourne Fashion Week in 2015, as the company tried to inject some glamour


But the company warned that even more stores could be shut entirely if landlords don't help with the costs of converting stores into Kmarts.

Mr Scott told the Australian Financial Review on Friday that more Kmart stores could help increase overall football into shopping malls and centre.

Announcing the conversion of some stores, rekomendasi Saham MAPI Wesfarmers said it was subject to 'subject to landlord support'. 

'To convert stores costs money and there are some stores that are not commercially viable in the current structure,' Mr Scott commented.

'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.' 






Many stores will be converted into Kmarts (pictured in Sydney) with the store still offering popular items

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