Card Factory sets sights on expanding retail partnerships

Following its interim results for the six months to July 31 posted today, chief executive Karen Hubbard said the card retailer will try to “grow market share through partnerships”.

After successful trials with value retailers Aldi and Matalan, Card Factory will be expanding into more locations and has a “number of new retail partner agreements” in the pipeline.

The specialist retailer will provide half of Aldi’s store estate – totalling 440 shops – with non-branded cards by November. 

“We could have 88 cards in [the stand], but the way we merchandise it, it’s 64 SKUs and it’s a single price point at 99p,” Hubbard explained. “They aren’t branded Card Factory, but they are designed by our design studio in Yorkshire and printed in Bradford.”

Hubbard said “both parties are very happy with the sales” from the initial trial, although she declined to give specific figures.

“Aldi never used to retail everyday cards, so for them it’s new sales, so they’re pleased with that,” Hubbard added.

Aldi managing director of buying Julie Ashfield said: “The convenience of buying a quick birthday or anniversary card along with your groceries has meant that greetings cards are increasingly the kind of product shoppers now expect to buy as part of their weekly shop.

“We carried out trials in two regions earlier this year and the feedback was overwhelming – our customers loved being able to buy a range of quality cards at a simple, low price point.”

However, the format for the partnership with Matalan is “completely different”, Hubbard said. “We can have two racks up to 16 so roughly anywhere up to 60ft of cards.” 

Matalan will also sell a range of Card Factory wrapping paper and gifts.

“We’ve got 15 stores open today and we’re trialling all different shapes and sizes to see what works in various stores. But it’s branded Card Factory and looks like our kit in the stores,” Hubbard said.

Quality and value

The aim of the partnerships is to gain more market share, but Card Factory will only be considering quality and value retailers.

“We’re not a discounter so our whole mantra is about having the best quality at the lowest price, so that quality value end, as opposed to the discount end or the premium end.

“What we wouldn’t do is partner with John Lewis, which is high-quality, high-pricing,” she said.

Card Factory has 1,000 stores across the country and even with its current and future partnerships, the specialist retailer will continue with its store estate strategy of expanding to 1,200 over the next three years.

“We will end up in the next three years with 1,200 Card Factory stores, Aldi, Matalan or [other partners], and we will end up in other locations that enable consumers to shop.

“We aren’t looking to cannibalise ourselves and the numbers suggest we aren’t in either Aldi or Matalan,” Hubbard said.