Kmart CEO seeks US expansion for Anko despite bumpy Target roll-out

New York: Kmart Australia’s chief executive is hoping to convince US retail executives of homegrown Anko brand’s local success, despite recent pushback from some Australian customers who were unhappy to see Target shelves being cleared to stock the popular private label range.

Speaking at the US’ largest annual retail conference on Sunday, Ian Bailey – now chief executive of Kmart and Target after the pair merged in July – said an unrelenting focus on finding cost efficiencies across the supply chain, passing savings onto customers, and rallying the 50,000-strong workforce around this mission had turned its private label into a recognisable brand in its own right.

Kmart boss Ian Bailey is hoping to translate the local popularity of its Anko brand to global markets.
Kmart boss Ian Bailey is hoping to translate the local popularity of its Anko brand to global markets.Credit: Wayne Taylor

“It’s the mono brand that our team has, for 15 years, built up incredible intellectual property associated with both understanding the product as well as the brand itself, and we think that … is compelling to be sold globally,” he said.

“We’ve made lowest price almost a religion.”

Despite predictions that consumer spending pressure is forecast to ease later this year, Bailey expects this to linger until as late as 2027, and is positioning Anko to perform well against this backdrop.

Anko includes kitchen products such as cast-iron cookware.
Anko includes kitchen products such as cast-iron cookware.

“We’ve got a massive advantage over our competitors. We have a scale advantage which is bigger. Second thing is we have an operational model which … means that we can execute really well,” he said.

“But what I know is just doing what we did, like last month won’t be enough. We have to continue to improve.”

About a week ago, Target began clearing out shelf space to roll out the Anko range, which represents 85 per cent of products in Kmart stores, encompassing dining and kitchenware, toys, small electronics and appliances, clothing and more.

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The move triggered dismay among some customers, who took to social media to share their frustration about the disappearance of Target’s typical range.

The Anko brand has cultivated a strong and loyal customer following, and is known for its low-cost alternatives to trendy items. Anko products are sold to customers across all income brackets, and the brand is courting the Gen Z demographic with beauty and storage products.

Aside from Australia and New Zealand, Anko is already being sold in Canada through discount chain Zellers and has a partnership with toy maker Mattel, which produces Barbie and Hot Wheels.

There is also an ongoing trial with a European retailer to test the sale of Anko pet products. Anko also has an online presence in India through Amazon and Flipcart.

Bailey sees the private label brand acting as an “accelerator” for large-scale retailers that don’t have a consistent low-cost offering, or are stocking one that isn’t performing strongly.

“We are the obvious solution to come in, and they can pretty much have an instant offer that they know has been proven and tested within our business already.”

Bailey said the company was in “lots of conversations” with several value-oriented retailers in Asia and the US and will be using his time in New York to meet retail executives attending the conference to introduce the Anko brand.

The private label’s biggest challenge will be the fact that it is still a relatively new brand competing in crowded and competitive international markets.

“Most of the businesses we’re talking to haven’t set up a relationship like this. So to a degree, it’s almost like trying to figure out, ‘what do you do and how does it work?’ There’s a little bit of discovery that we go through when we’re dealing with a potential partner,” he said.

“Part of what we’ve been doing is figuring out: how do we tell the story more clearly?”

This reporter travelled to New York as a guest of Salesforce.

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