Bunnings: the power and the profitsBy Angus Grigg, the Business Reporting Team's Emilia Terzon, Elise Potaka, and Ben Schneiders Four CornersTopic:Businesses1h ago1 hours agoMon 12 May 2025 at 5:04amBunnings has become one of Australia's most profitable retailers. (Four Corners/Alistair Kroie)abc.net.au/news/how-did-bunnings-get-so-big/105265412Link copiedShareShare articleIt's hard to get your head around just how big and profitable Bunnings has become, so here are seven numbers that show how quickly it has come to dominate the Australian hardware sector.$18.97 billion Bunnings Group is super profitable.It made $18.97 billion in revenue in 2024. That's five times more than its nearest competitor.That delivered the group $3.2 billion in profits before taking out tax, interest and depreciation.Last year its profit margin was 16.8 per cent, that's nearly double that generated by Coles or Woolworths — criticised by the ACCC for being among the most profitable supermarkets in the world.Coles had an 8.9 per cent profit margin last year, and Woolworths had a 9.9 per cent profit. 69.2 per cent return on capital It's hard to picture Bunnings' profitability.To break it down, let's look at Bunnings return on capital.If someone was to put $10 in the bank they would earn about 40 cents every year from interest.For every $10 Bunnings invests securing land, building stores, and buying stock it gets back $6.92 every year. Coles and Woolworths' return on capital is less than half that.310 stores As the new millennium began Bunnings had $1.49 billion in sales across 43 stores.Today its revenue is about 13 times that, and it has 310 stores in Australia.Its empire also includes stores in New Zealand, Beaumont Tiles and Tool Kit Depot — both acquired with no objection from the ACCC.And it's continuing to build new warehouses.17 per cent Bunnings's market share is highly contested.Research firm IBISWorld estimates its hardware market share is somewhere above 33 per cent. One rival claims it could be as high as 70 per cent.That's not the number Bunnings uses.It says it's market share is just 17 per cent.How does it get to this number?The company claims it competes against almost everyone: Mitre 10, Coles, Woolworths, Kmart, JB Hi-Fi, and Myer.Even Spotlight, Amazon, eBay, Kogan, PetStock, and Petbarn.Ultimately, it's impossible to independently verify this figure, because Bunnings won't release detailed data.66 per cent mark-up Suppliers say Bunnings is making sizeable profits from their products. Bunnings purchased a bag of worms from a farm in regional Queensland for $29.94 then sold it to customers for $49.90.That's a 66 per cent mark up.Then there are the rebates.In recent years, suppliers have been charged:a volume rebate between 1.5 per cent and 7 per cent,15 per cent for new store openings,and if they wanted to be paid more quickly that was another 5 per cent.Then there's marketing fees, and a supplier could even be charged if their stock is discounted.9,000 The hardware giant has more than 9,000 home brand products.These are products manufactured exclusively for Bunnings, where the hardware giant owns the trademark.This isn't clearly disclosed on its packaging, in-store, or on the Bunnings website. Some home brands even have their own website.Bunnings' brands include everything from Trojan tools, Jumbuck barbecues and Craftright toolboxes to Marquee outdoor furniture, Mondella toilets and Happy Tails pet supplies.This raises questions about its price famous guarantee which urges customers to "find a cheaper price on the same stocked item, we'll beat it by 10%."But how can you find a product cheaper elsewhere if it's only sold by Bunnings?Bunnings says it complies with all legal and regulatory requirements for product labelling and "empowers" staff to take a "common sense approach" and price match on similar items.1994 Bunnings wasn't always so dominant.It began life as a WA timber company prior to federation.In the early 1960s it expanded into retail only opening its first warehouse in 1994.A year before then Bunnings took over McEwans hardware, then in 2001 it moved on BBC Hardware, also trading as Hardware House, giving it a national footprint.The competition regulator, the ACCC, waived through the deal without a single objection.Watch Four Corners' Hammered on ABC TV and ABC iview.Posted 1h ago1 hours agoMon 12 May 2025 at 5:04amShareCopy linkFacebookX (formerly Twitter)Related topicsACTAustraliaBusinessesNSWQLDRetail IndustryVICWATop StoriesNationals to give 'stability and strength' to the Coalition after Littleproud re-electedLIVEPhoto shows David Littleproud, flanked by Kevin Hogan and Bridget McKenzieRowland to become attorney-general on Albanese's new-look frontbenchTopic:ElectionsPhoto shows Anthony Albanese waves inside parliament house.One child is slapped, another vomits metal hooks: Inside an Australian childcare giantTopic:Child CarePhoto shows A still from a Snapchat video shows a baby on a bouncer crying.Is Chalmers prepared to follow Keating into the 'slaying' business?AAnalysis by Alan KohlerPhoto shows Jim Chalmers walks into QT smiling.Australian bomb disposal worker killed in UkraineTopic:Unrest, Conflict and WarPhoto shows ukrainelandminesPopular nowLittleproud stays on as Nationals leader after party voteLIVEPhoto shows David Littleproud, flanked by Kevin Hogan and Bridget McKenzieRowland to become attorney-general on Albanese's new-look frontbenchTopic:ElectionsPhoto shows Anthony Albanese waves inside parliament house.Vandals damage culturally significant waterfalls loved by touristsTopic:VandalismPhoto shows spray paint letters on a rock wallTop StoriesNationals to give 'stability and strength' to the Coalition after Littleproud re-electedTopic:Government and PoliticsPhoto shows David Littleproud, flanked by Kevin Hogan and Bridget McKenzieRowland to become attorney-general on Albanese's new-look frontbenchTopic:ElectionsOne child is slapped, another vomits metal hooks: Inside an Australian childcare giantTopic:Child CareIs Chalmers prepared to follow Keating into the 'slaying' business?AAnalysis by Alan KohlerAustralian bomb disposal worker killed in UkraineTopic:Unrest, Conflict and WarJust InUkrainian ambassador visits regional cafe that put tariffs on US goodsTopic:Small Businesses20m ago20 minutes agoMon 12 May 2025 at 6:00amLittleproud remains as Nationals leader, seeing off Canavan challengeTopic:Federal Government10m ago10 minutes agoMon 12 May 2025 at 6:10am'Oblivious': This operator says light rail assistance is little helpTopic:State and Territory Government11m ago11 minutes agoMon 12 May 2025 at 6:10amVandals damage culturally significant waterfalls loved by touristsTopic:Vandalism46m ago46 minutes agoMon 12 May 2025 at 5:34amMore Just InBack to top