Kingfisher chief executive Véronique Laury is already making her mark on the business with plans to restructure and innovate.

Kingfisher boss Véronique Laury is the latest industry leader to find that the honeymoon period of new retail chiefs is short-lived these days.

As well as dealing with the collapse of its much-vaunted €275m (£200m) merger with Mr Bricolage after opposition to the deal, she faces concerns in the UK that the business has not leveraged an improving housing market to the degree many believe it should have. And the latest set of results has only added to the suggestion that Kingfisher is in need of its own careful restoration.

The DIY group this week reported that adjusted pre-tax profit tumbled from £730m to £675m. Sales fell from £11.13bn to £10.97bn, although net cash rose from £238m to £329m.

The failure of the Mr Bricolage deal, which would have significantly strengthened the group’s position in France, is a setback. However, in the short term it does allow Laury to get her house in order.

As well as unveiling plans to address B&Q’s over-sized property portfolio by closing 15% of its space, Laury will embark on a bold restructure of the business, focusing on greater unity across markets.

Laury believes the retail giant’s £7.4bn buying scale is still relatively untapped and suffers from a fragmented supplier base. The talk about creating greater efficiencies in the supply chain is nothing new and it will be interesting to see how Laury expects to succeed in this area where others have failed to make much progress. There is clearly also the opportunity to share expertise in new product development in a market where innovation remains an important growth driver.

However, it is in the reorganisation of her leadership team that Laury has made her boldest play. Rather than organising the business by operating companies or international markets, Laury is segmenting the group by format, splitting the business into big box, medium box and omnichannel, and appointing three operations directors to oversee the business units.

The structure will ensure that the business can develop process and products that can be rolled out across the business. At its heart, Laury’s vision is based on the belief that DIY customers across the company’s global footprint have the same needs and that the markets it serves are “fundamentally more similar than different”.

But this is an audacious move that questions the wisdom that decentralised and localised operations deliver a better understanding of regional consumer nuances. From grocery to fashion, retail’s recent history is littered with examples of businesses that underestimated the differences and overplayed the similarities of consumers in international markets. 

The success of this plan will rely on whether DIY is the exception, and one wonders what lessons have been learnt from B&Q’s recent travails in China.

But with only 5% of the European DIY market, Kingfisher has plenty to play for, and Laury has wasted no time in laying her foundations.

  • Chris Brook-Carter, Editor-in-chief