Wesfarmers Ltd, one of Australia’s largest retail giants, has announced it will shut down its online retailing platform, Catch, by April 30, 2025, citing intense competition and mounting financial losses as the primary reasons behind this decision. The company projects Catch to incur around $40 million in losses during the current financial year, leading to the tough call to wind down operations.
Wesfarmers, known for its ownership of brands like Kmart and Bunnings, revealed plans to transition Catch's operations and assets to other divisions within the group. Approximately 190 jobs are expected to be lost as part of this closure, with Wesfarmers indicating they will provide options for redeployment where possible.
According to Wesfarmers managing director Rob Scott, "While Catch’s financial performance has been challenging, we have gained valuable insights and capabilities..." This sentiment reflects the aim of leveraging the assets developed within Catch to strengthen Wesfarmers' overall offering. The company acquired Catch back in 2019 for $230 million, hoping to tap directly as e-commerce boomed. But the retail environment has dramatically changed since, with growing pressure from cheaper international websites like Temu and established giants like Amazon.
Scott highlighted the firm’s recognition of the increasing intensity within the Australian e-commerce sector, stating, "The recent increase in competitive intensity...has affected Catch’s financial performance and growth prospects." His remarks speak to the frustrations being felt within many local businesses as they face off against cheaper overseas competitors.
With significant challenges lying ahead, Wesfarmers is intent on refocusing its resources. The fulfilment centres currently operated by Catch, located at Moorebank, New South Wales, and Truganina, Victoria, will be integrated with Kmart Group, purportedly aimed at enhancing customer experience and operational efficiency.
The financial fallout from the closure will not only affect the direct employees of Catch but will also include one-off costs associated with the transition, estimated between $50 million and $60 million. While the future remains grim for Catch as a standalone entity, Wesfarmers aims to incorporate select digital capabilities—including supplier relationships and experienced personnel—into its retail operations which are faring significantly stronger.
Scott remains resolute, framing the closure as strategically sound, as he believes it will enable the group to leverage the insights gained through the Catch experience to bolster their retail divisions even more. He noted, "Our retail divisions currently represent the largest non-food, omnichannel retail group in Australia." The adoption of digital technologies and data insights gained from Catch's struggles is expected to position the company favorably moving forward.
For customers holding unused Catch vouchers, Wesfarmers announced they will be refunded after the platform completes its shutdown. It is also noteworthy to mention there will be no immediate disruption to customers who have signed up for phone plans priced through Catch, as those services will continue operating through their separate entity under Optus.
The decision to shut down Catch has already drawn reactions on social media, with some former users echoing sentiments of relief rather than discontent with the closure. Complaints about product quality and customer service issues have surfaced from past buyers, indicating potential gaps relating to the platform's reliability.
Wesfarmers continues to evaluate the competitive retail environment, particularly with pressures mounting from international players offering lower prices and attractive products to local consumers. Many local business owners, including prominent figures like Gerry Harvey, have voiced concerns about the sustainability of the Australian retail sector against these foreign giants who take advantage of their more flexible operational frameworks.
Moving beyond the challenges posed by the closure, Wesfarmers seems set on adapting and enhancing their existing retail frameworks to navigate through increased competition and meet changing consumer expectations. The retail group is committed to preserving its position as the top non-food retailer, leveraging strong brands and omnichannel capabilities to bolster its growth strategy.
With the closure of Catch looming, the spotlight now turns to how effectively Wesfarmers can transition the assets and capabilities of Catch’s operations and how its broader retail division will respond to the growing e-commerce marketplace.