Retail Dealtracker 2026: selectivity, scale and strategic advantage
Grant Thornton finds retail M&A deals centre on scale, resilience and earnings certainty
04 Jun 2026
Grant Thornton Australia has released its second Retail Dealtracker: selectivity, scale and strategic advantage, analysing retail transactions up to 31 December 2025.
While overall deal volumes have softened, the data points to a clear shift towards more selective and strategic transactions, with greater emphasis on asset quality, operational resilience and earnings certainty.
The report highlights key trends across Australian and global retail markets with three themes emerging: increased discipline in dealmaking, cost pressures driving caution, and consolidation and capacity shaping deal strategy.
Retail M&A is more selective and disciplined
The retail sector has experienced a challenging operating environment. M&A activity has slowed, with fewer transactions overall, while available capital is increasingly concentrated in larger, strategic deals focused on scale, resilience and earnings certainty.
This shift reflects ongoing macroeconomic pressures across the retail industry, including:
- Australia’s CPI rising by 3.8 per cent in the 12 months to 31 December 2025 (ABS)
- Labour costs increasing by 3.4 per cent over the same period, continuing to lag price inflation
- Household savings rates lifting from 5.5 per cent in Q4 2024 to 6.9 per cent in Q4 2025 (ABS)
- Retail spending rising by around 5.8 per cent year on year, above the long-term trend of around 4.9 per cent.
Together, these conditions are reinforcing a more disciplined and selective M&A environment, shaping both the pace and nature of transactions across the entire retail sector.
Transaction activity is being shaped by ongoing cost pressures and cautious consumers
Retail margins moderated as cost pressures weighed on profitability. Businesses exposed to weaker discretionary demand were more vulnerable as households tightened spending in response to ongoing cost‑of‑living pressures. This pushed buyers to prioritise margin durability, cash generation, and operational control over pure growth. As a result, food categories remained the most resilient.
Consolidation and capability-led acquisitions are driving deal strategy
The report found there has been a strong trend towards consolidation, particularly in Food, Pharmacy, and Home & Hardware, while interest in standalone digital platforms continues to decline. Transactions such as Sigma Healthcare/Chemist Warehouse and Woolworths/PFD Food Services highlight the value buyers place on scale, procurement efficiency, and supply chain control. As a result, buyers are increasingly directing capital towards businesses that can scale, have a defensible market position, and deliver more predictable earnings.
Tam Goldin, Corporate Finance Partner and Retail & Consumer Products specialist said: “As M&A activity in retail becomes more selective, businesses need to think carefully about where they can genuinely add value and whether that’s through scale, steadier earnings or a clearer strategic fit. There are fewer deals happening, but the ones that do go ahead tend to be more purposeful. We’re also seeing less interest in standalone tech businesses, as customer loyalty in digital retail can be hard to lock in, making these models less resilient. Businesses like Catch, MyDeal and Cashrewards highlight how challenging it can be for standalone platforms to succeed. There is still opportunity when transactions are well considered and strategically positioned.”
Kirsten Ridgway, Management Consulting Partner and Retail & Consumer Products specialist said: “Companies that understand where they fit in the market, what makes them valuable, and how their brand complements potential buyers, sellers or partners are far better placed to succeed. Strategic clarity around value creation, differentiation and alignment is what becomes attractive in the market. It’s more critical than ever to take a thorough approach to strategy and design in your retail operations and that starts with asking the right questions.”
Grant Thornton’s Retail Dealtracker examines M&A and equity market activity in the Retail & Consumer Products sector up to 31 December 2025. The data in this report was compiled from several sources including the Australian Bureau of Statistics (ABS), SSP Capital IQ, the Australian Securities Exchange, Mergermarket, IBISWorld, company announcements and other publicly available information. We consider this consolidated multi-source analysis, alongside our own proprietary sources, to provide a comprehensive insight into recent deal activity.
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