Coles Group vs Wesfarmers
Wesfarmers holds the stronger position because its main profit engine, Bunnings, sits outside the price war that is squeezing Coles' entire grocery business.
Coles Group
Coles is one of Australia's two dominant supermarket chains, running physical grocery stores nationwide
Wesfarmers
Australian retail and industrial group running Bunnings, Kmart, Officeworks, Priceline and lithium/chemicals
Dimension by dimension
| Dimension | Coles Group | Wesfarmers |
|---|---|---|
| Staying power of the core product | Coles is a single grocery chain, so any slippage in supermarket share hits the whole company at once. | Wesfarmers runs several separate businesses; Bunnings' trade and renovation customers keep buying regardless of online discounters. |
| Exposure to AI absorbing the product | Physical grocery shopping is also unlikely to be absorbed by AI. | Physical hardware, general merchandise and health retail are unlikely to be replaced by AI tools. |
| How easily a giant could copy them | Coles' store network and supplier relationships are similarly hard for a new entrant to copy. | Bunnings' scale, supplier deals and store network are hard to replicate quickly. |
| Pressure from rivals | ALDI and Metcash-supplied IGA stores are directly undercutting Coles on everyday prices, chipping at its core grocery share. | Temu, Shein and Amazon Australia are pulling shoppers from Kmart and Officeworks, but Bunnings' trade-focused core is largely untouched. |
| Financial footing | FY25 NPAT was around A$1.1 billion on A$44.35 billion revenue, a thinner margin than Wesfarmers. | FY25 statutory NPAT hit A$2.926 billion, up 14% year on year, on A$45.7 billion revenue. |
| Overall protective strength | Coles' reliance on a single grocery format means it faces heavier direct pressure than Wesfarmers from ALDI and IGA on price, assessed July 2026. | Bunnings' trade-focused base and diversified retail portfolio give Wesfarmers stronger insulation from price competition, assessed July 2026. |
Questions people ask
- Wesfarmers vs Coles, which is safer from AI disruption?
- Neither Wesfarmers nor Coles is expected to have its products absorbed by AI. Both sell physical goods and groceries that people still need to buy in person, so this factor does not separate them.
- Which company faces more competitive pressure, Wesfarmers or Coles?
- Coles faces pressure across its whole business from ALDI and IGA stores competing on everyday prices. Wesfarmers' pressure is narrower, hitting Kmart and Officeworks from online discounters like Temu and Shein while Bunnings stays largely unaffected.
- Which has better financials, Wesfarmers or Coles?
- Wesfarmers posted FY25 net profit of A$2.926 billion, up 14 percent, on A$45.7 billion in revenue. Coles posted roughly A$1.1 billion in net profit on A$44.35 billion in revenue, a smaller profit on similar revenue.
- Could a big tech company replicate Wesfarmers or Coles?
- Both are considered blocked from easy copying because of their store networks, supplier relationships and scale. Neither Wesfarmers' Bunnings and Kmart operations nor Coles' supermarket network could be quickly rebuilt by a new entrant.
- Is Wesfarmers or Coles more diversified?
- Wesfarmers runs multiple businesses including Bunnings, Kmart, Officeworks and Wesfarmers Health, spreading its risk across categories. Coles operates as a single supermarket chain, so its fortunes depend entirely on grocery retail.
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