Discount fashion and homewares retailers TK Maxx and HomeSense are to embark on huge expansion drives in the UK and Europe.
Retail Week has learnt that TJX Europe, the European arm of US retailer TJX Companies, which owns the two off-price retailers, ultimately plans to turn HomeSense, which at present has eight UK stores, into a 100- to 150-store chain in the UK and Ireland. It also wants to add 50 TK Maxx stores to make it a 275-store chain in the UK and Ireland.
The plans are the latest sign that value and discount retailers are cashing in as bargain-hungry shoppers flock to their stores. Last month TJX Companies revealed a record first quarter for the business, including 6 per cent like-for-like growth and a 42 per cent jump in profits to $15.5m (£9.4m) in the three months to May 2 at TJX Europe.
The company, which offers designer brands at discounts of up to 60 per cent, also has big plans for Germany, where it believes it can open as many as 300 stores. It only has nine so far but will grow to 24 this year. It also intends to enter Poland, opening three stores in the second half.
“The European group has seen significant growth in the last two years,” said TJX Europe group president and senior executive vice-president Paul Sweetenham. “We are outperforming our expectations – even in today’s challenging retail environment.”
TK Maxx intends to open 32 stores in its existing European markets this year, including 10 in the UK and Ireland. It also plans to take advantage of the weak property market to relocate some stores to larger, better placed sites and extend others.
Seven HomeSense stores will open in the UK and Ireland this year. Sweetenham said he was “pleased” with its performance so far, despite the tough homewares market.
To support the growth, TJX Europe will move its Milton Keynes distribution centre to Wroclaw in Poland in June. The Milton Keynes warehouse is expected to close in summer 2010. 100 people are facing redundancy, with the remaining 195 set for redeployment at distribution centres in Stoke, Wakefield and Walsall.
TJX Europe, which employs 13,500 staff, will create around 750 jobs in the UK this year. It is understood the company is also planning to open a store in Milton Keynes.