Wesfarmers says its budget-focused Anko range is beginning to appeal to higher-income shoppers, marking a shift for a brand traditionally associated with low-cost retail.

Chief executive Rob Scott noted that demand for Anko products has broadened beyond its core customer base, with more affluent consumers showing confidence in both the quality and value of the range. The brand, launched in 2019, now sells more than one billion items annually across categories such as homewares, clothing and toys in Australia.

The growing interest from wealthier households is opening up new opportunities for expansion, particularly in areas like furniture, where much of the growth is being driven online. Scott said this trend would have been difficult to predict several years ago, but changing perceptions of quality have helped reposition the brand.

Anko’s development has been underpinned by long-term investment in supply chain control, which Wesfarmers sees as a key advantage in a highly competitive market. By managing design, sourcing and production processes closely, the company has been able to keep prices low while maintaining consistency across its products.

Around 1000 staff based in Asia are involved in sourcing materials, working with manufacturers and overseeing production, giving the business greater control over costs and product development.

The strategy comes as Kmart faces increasing competition from overseas platforms such as Temu and Shein, which have gained traction by offering extremely low-priced goods. The rise of these players contributed to the closure of Wesfarmers’ Catch marketplace, prompting a shift in focus towards strengthening Kmart’s own offering.

Photo by Kmart

To support its online growth, the retailer has repurposed former Catch fulfilment centres, enabling faster delivery times across much of Australia’s east coast. The company has also expanded its marketplace, which now features more than 100,000 products alongside the core Anko range.

Kmart Group managing director Aleks Spaseska has outlined plans to significantly grow the business over the next decade, with Anko playing a central role in attracting younger shoppers and expanding into new product categories such as beauty.

Scott acknowledged that rising interest rates could place additional pressure on household budgets, but said the company’s value-driven approach should help it remain resilient. While cost increases are being felt in areas such as materials and transport, Wesfarmers expects to offset these pressures through efficiency gains and scale.

Featured photo by Kmart