In a surprise announcement Wednesday afternoon (24 January), German supermarket giant Kaufland announced it was exiting the Australian market. The decision leaves 200 people unemployed and myriad shocked contractors and third parties.
The company’s acting CEO Frank Schumann said the decision had not been made lightly and its exit would be orderly. “This was not an easy decision for us. We always felt welcome in Australia. We would like to thank our employees and we apologise for the disruption this decision will cause,” Schumann said in a statement.
“This decision is about focusing business activities in Europe and is in no way a reflection of the efforts of our local employees or management, or the support Kaufland has received from the Australian business community or governments.”
Staff were told on Wednesday, he said. He said the company assured “generous packages” with all entitlements would be offered.
“The future of Kaufland’s existing Australian investments, including properties purchased for retail outlets and distribution infrastructure, will be discussed with the relevant parties in coming days.
“We would also like to thank our business partners, who offered us great support over the last few years. We would also like to thank the government for being very open-minded to our projects.
“In Europe, we see a great deal of growth potential. We will actively shape the consolidation of the European retail sector, thus further reinforcing our leading position.”
In March last year, the Victorian Government said Kaufland’s investment in the state was worth $435 and expected to create more than 2000 jobs once it was fully up and running.
In June, there was a turning of soil event to announce Vaughan Constructions had been awarded the contract to build the company’s distribution centre for the company in Mickleham industrial estate in Victoria, said to be the largest in Australia (Food & Drink Business, 26/06/2019).
Owned by the German Swharz Group, Kaufland is the fourth-largest food and grocery retailer in the world. It operates in Germany, Poland, the Czech Republic, Romania, Slovakia, Bulgaria, Croatia, and the Republic of Moldova with roughly 1300 stores and 132,000 employees.