Variety retailers more than fill the gap left by Woolies…….and more shop openings are planned as single-price retailer Poundland gears up for float.
Variety retailers have blanketed the UK with more stores in the last four years than Woolworths operated at the time of its collapse.
Value retailers boomed in the recession and since, as evidenced by Poundland’s intention to float next month.
Data from Retail Week Knowledge Bank (RWKB) shows value retailers Poundland, B&M Bargains and Poundworld and have led the way in store openings. They launched 237, 167, and 162 shops respectively in the four years to January 2014.
They are followed by Home Bargains (125), 99p Stores (114), Poundstretcher (67) and Wilkinson (37).
The seven retailers have opened 909 stores between them in four years, more than filling the gap left by Woolworths when it closed its 807 stores in 2009 and providing evidence that retailers still have faith in the high street.
RWKB analyst Philip Wiggenraad said the retailers have rushed to take advantage of the gap Woolies left, as well as the economic conditions. But he cautioned that not all of the new stores have been successful.
“Both 99p Stores and Poundworld have opened multi-price formats but, following an initial flurry of openings, progress has been decidedly lacking more recently,” he said.
“There might also come a saturation point where further expansion will come at the expense of some of the weaker players.”
Poundland this week unveiled its plans to float, which will help fund its expansion. It aims to have 1,000 stores across the UK.
The single-price retailer, which is owned by Warburg Pincus, operates more than 500 stores at present and is preparing to launch on the continent for the first time. Ten store openings are planned in Spain in the next two years.
Poundland chief executive Jim McCarthy told Retail Week: “The Spanish market has very similar characteristics [to those of] Ireland when we launched there in 2011. And since its launch Ireland has paid back every cent that was invested.”
Poundland is thought likely to be valued at between £700m and £750m when it floats in March.