Hardware expert Geoff Dart, the man who first predicted massive losses at Masters, says the chain needs to dump timber and tools in favour of paint, carpets and tiles to prevent losses reaching $1.3 billion by 2020.

Mr Dart said Masters, a joint venture between Woolworths and United States retailer Lowe's, could not survive or be sold in its current form because its stores were too large and did not generate sufficient foot traffic, sales or margins to cover high operating costs.

The Masters hardware chain was flawed from the start under Project Oxygen, as it was dubbed internally at Woolworths. Credit:Glenn Hunt

But by moving out of the trade and garden categories and targeting the $38 billion home decoration and lifestyle market, which included "finishing" products such as paint, flooring, window coverings and kitchens, Masters could be profitable in a year or two, Mr Dart said.

"I'm not anti-Masters but the model just won't work," said Mr Dart, who was accused by Woolworths of mounting a "dirty tricks" campaign when he forecast in 2012 that the home improvement business could lose $151 million in 2013.