the course for a business that has been under-performing for years. Divest or turn around? Retail analysts have anticipated the divestment of the chain for the best part of a decade, with Big W dragging on Woolworths’ results and failing the resuscitation efforts of a succession of hopeful turnaround plans. The only explanation for Woolworths’ disinclination to bite the bullet and exit Big W would seem to be the hope that Wesfarmers would abandon the rival Target brand and that Big W might emulate Kmart’s revitalisation. While retaining Big W, Woolworths has not shown any qualms about exiting other businesses, including closing down the Masters Home Improvement chain and divesting its liquor and hotels business as well as the Dick Smith electronics chain. There was a view pre-Covid that Woolworths wanted to offload Big W but was concerned about the price it might be able to realise and decided to attempt to improve the chain’s performance to make it more attractive to a potential buyer. There is some logic in that thinking given the embarrassment of the sale of the Dick Smith business to Anchorage Capital for just $20 million in July 2013 after Woolworths had spent hundreds of millions of dollars on restructuring and shuttering unprofitable stores. Anchorage relisted the Dick Smith chain on the Australian Securities Exchange just five months later for $344.5 million The failure of the Masters hardware venture as a competitor to Wesfarmers’ Bunnings possibly also forced Woolworths to try to reinvigorate Big W rather than risk further reputational damage with an inadequate return for an underperformer that was still generating around $5 billion in sales. In any event, the Big W transformation efforts have provided modest results over more than a decade, and sales are again declining in the current financial year after also falling 2.1 per cent in FY24 after a post-Covid recovery in FY23. The results this year show no gain on turnaround strategies implemented in FY24 that included new range and space management, including a reset of apparel ranges and promotional plans. Cyclone Albert might have impacted somewhat, but the year previous also had issues, including stock availability in stores, which has particularly impacted the clothing range reset. Woolworths is clearly uncertain about the future of Big W, adding just two new stores and refurbishing three in the past two years. Perhaps the pause on refurbishments can be attributed to the assessment of the new “modern store design” Big W launched last financial year at Stanhope Gardens in Sydney, but refreshing stores is really an imperative. Tinkering not enough According to Bardwell, Woolworths remains focused on “improving our retail fundamentals in value, availability and range, simplifying the way we work and unlocking the full potential of the group”.  “While the market remains competitive and consumer outlook uncertain, we are making progress in these areas and will provide a more detailed update at our full year results in August,” Bardwell said when releasing the third quarter financial results.  The problem with Big W is that tinkering is not enough, and there is no clear strategy for the brand. The chain has a similar identity or relevance factor as the Mosaic Brands chains, notwithstanding a multibillion-dollar sales turnover that fails to generate consistent, healthy bottom-line results. Emulating Kmart’s success is not a quick exercise, as it took Guy Russo a decade to turn around a lumbering Kmart, and Big W doesn’t have the luxury of a lengthy rebuild. It is a tough call to abandon a business that has annual sales of more than $4.6 billion, but without substantial new capital investment and a compelling point of difference and retail offer, Big W is unlikely to arrest its declining fortunes. Big W is just not competing with Kmart, the benchmark for the homegrown discount stores, or its stablemate Target.