Big W’s sales are falling as Kmart grows, so what’s next for two of Australia’s biggest department stores?

In a tight economy, discount retailers should, at least at first glance, be among the biggest beneficiaries. But the results from two of Australia’s biggest tell very different stories.

While Kmart, anchored by its own brand Anko, has been a success story for parent company Wesfarmers, sales at rival Big W have slumped over the past year and Woolworths management says the store may not break even this year.