The addition of industry veteran Andrew Higginson to the board of Poundland and Monday’s news that 99p Stores has posted an uplift in profits is further evidence of the maturing status of the single-price sector.

The addition of industry veteran Andrew Higginson to the board of Poundland and Monday’s news that 99p Stores has posted an uplift in profits is further evidence of the maturing status of the single-price sector.

There is little doubt the economic winds are blowing in favour of the category as well as value retailers more widely, as evidenced by the continuing market share gains made by Lidl and Aldi this week.

The oppressive economic conditions are forcing other retailers to wrestle with the prospect and reality of slashing store portfolios. But the collective footprint of Poundland, 99p Stores, Poundworld and Poundstretcher – though this final player is not a single-price specialist – has grown from 810 stores in 2010 to approaching 1,200 in July this year, according to Retail Week Knowledge Bank data.

Maligned by some sections of the public and some landlords in the past, the rise in store numbers has been accompanied by strengthened credibility. Their ability to take high street space that would otherwise lie empty, drive footfall in town centres and tap into the British obsession for bargains should be celebrated.

And the pace at which the sector is transforming is unlikely to relent. When he is not taking on Anne Robinson on BBC’s Watchdog, 99p Stores boss Hussein Lalani is relentlessly building the business, while Poundland has international aspirations. 

But it’s the appointment of Higginson that represents the clearest sign yet of the sector’s advance. He will add the discipline and experience of his years at Tesco to the considerable talents of chief executive Jim McCarthy, and the appointment positions the business well for the future, whether that may be overseas growth or an IPO.

And yet as the sector enters a new phase of its development, fresh challenges are emerging, not least how to maintain this growth. International expansion will play a part, whether in Ireland or the Middle East, where Poundland and Poundstretcher have opened shops.

But perhaps it’s the retailers’ digital strategies – or lack of them – that will be the biggest hurdle. Poundstretcher tried a transactional site but shut it earlier this year. One of the problems for them all is that the low value of sales generated online may not make investment worthwhile.

There has been much to applaud in the way Poundland and its brethren have provided hope for the high street, but even these value-driven retailers will have to adapt to the online world if they are to continue to thrive.