Australian e-commerce platform Catch is looking to shut down, resulting in approximately 200 job losses due to heightened rivalry from Amazon and Temu.
Wesfarmers, which acquired the online retailer for $230million in 2019, issued a closure announcement on Tuesday.
According to a Daily Mail report, the company expects an operational deficit reaching $40million in the initial half of 2024-25.
“While Catch’s financial performance has been challenging, we have gained valuable insights and capabilities that have accelerated the group’s digital transformation and supported the development of the OnePass membership program,” Daily Mail quoted Wesfarmers managing director Rob Scott as saying.
The company cited intense rivalry from international online retailers such as Temu, Shein, and Amazon.
“The recent increase in competitive intensity in the Australian e-commerce sector has affected Catch’s financial performance and growth prospects,” according to the announcement.
Whilst 100 positions will be preserved and transferred to other Wesfarmers subsidiaries like Kmart, 190 positions will be eliminated.
The logistics centres will transition to Kmart’s control during the final quarter of 2024-25.
Kmart Group Managing Director Ian Bailey indicated the arrangement would enhance customer service through access to Catch’s Moorebank warehouse in Sydney’s south-west.
“Kmart Group can better utilise Catch’s fulfilment centres, which are currently less than 50 per cent utilised. The transition will result in faster deliveries to customers at a lower unit cost, while relieving pressure on our busy stores,” he explained.
Established by Gabby and Hezi Leibovich as Catch of the Day in 2006, the business gained popularity amongst value-conscious Australian shoppers but ultimately struggled against competitors who faced fewer operational costs and taxes.