Kmart Group’s saviour Ian Bailey heads for the check-out

Wesfarmers has placed Kmart in a safe pair of hands as it prepares to wave goodbye to the man credited with rescuing the brand from a near-death experience and turning it into an Australian retail success story.

The conglomerate announced on Thursday that Ian Bailey would leave Kmart Group — which also includes Target — in April next year, bringing the curtain down on a nine-year stint at the top that turned Kmart from a department store deadweight into a runaway hit with cost-conscious shoppers chasing quality and value.

Mr Bailey will remain with the group to support a smooth leadership transition to chief financial officer Aleksandra Spaseska and will serve as chair of Anko Global— Kmart’s wildly popular own-label brand which includes low-priced versions of popular designer products.

Ms Spaseska, 41, becomes the group’s youngest divisional chief.

Anko accounts for about 85 per cent of store stock and is now growing further into international markets.

Speaking to The Nightly on Thursday, Wesfarmers chief executive Rob Scott reckons it will be a “very seamless transition” between Mr Bailey and Ms Spaseska. He’s looking forward to “seeing Aleks continue the strong growth of Kmart”.

“A lot of the key strategies within Kmart Aleks has been involved in so we can expect a continuation of what we’ve seen,” he said.

“Kmart is always innovating and always developing their business so I have no doubt that over the next decade Aleks will help drive new strategies to support the next stage of growth.”

Mr Scott said Ms Spaseska stood out from the rest of the candidates with her “unique combination of experience”.

“She (has) very strong commercial acumen, she’s had experience across a range of roles in Wesfarmers,” Mr Scott said, pointing to her additional responsibilities for global sourcing as well as domestic and international supply chain.

Ms Spaseska, who has also held senior divisional and corporate executive positions with Wesfarmers, will now act as Mr Bailey’s deputy and will take over his role on April 1.

Mr Bailey said he was proud to have led the rebirth of Kmart.

“It has been a privilege to lead the Kmart Group team as we transformed the businesses, making Kmart a great place to shop that is simple to run,” Mr Bailey said.

“I will leave the division in very capable hands and look forward to supporting Aleks during the transition and beyond.”

Mr Scott paid tribute to Mr Bailey’s “outstanding contributions” and said he had left the group in “excellent shape”.

“Ian has played an instrumental role in Kmart Group, driving the transformation of Kmart, including the development of the unique sourcing model which has underpinned its success and created significant value for Wesfarmers’ shareholders,” he said.

“He has been a pivotal figure in Kmart’s growth, creating a world-class product development company and trusted brand.”

At the turn of the century Kmart was in dire straits, close to being closed with Target and Big W outperforming it.

Mr Bailey took on the top job in 2016, having previously worked as its chief operating officer. Before that, he was finance director at Officeworks, one of Kmart’s Wesfarmers stablemates.

Mr Bailey in October recalled his period as COO in 2008 when the business was “really fighting for survival” and languishing behind its competition, as among the most challenging periods of his leadership tenure.

He told The Nightly it even eclipsed the uncertainty of leading through the initial stages of the pandemic in 2020

“The choices we made at that time would have been the difference between us surviving or not,” Mr Bailey said.

“It was a question of ‘how do we navigate this uncertainty as well as we can?’ I never felt like our business was going to go broke during COVID. I didn’t feel our business wouldn’t be there when the COVID period came to an end, whereas in 2008 I didn’t know if there would be a 2009.”

While Kmart continues to thrive, it’s a different story at Target and Ms Spaseska will be hoping to bring a transformational mindset to the struggling retailer.

Target sales continued their decline last financial year, down 4.5 per cent, but Kmart Group has now introduced selected Anko products to help bring in more shoppers.