Poundland chief executive Jim McCarthy said the 157-store retailer will consider launching in Europe and the Far East once it has extended its UK portfolio to 650 stores.
He said: “Tesco developed a UK market, then looked abroad. We will follow a similar plan.” However, McCarthy declined to provide a time frame.
The retailer wants to increase annual sales to£500 million by 2010, by which point McCarthy hopes to have at least 232 stores. Sales at the private equity-owned chain increased to£310.7 million for the 52 weeks to April 1, from£281.2 million the previous year.
McCarthy wants to increase the average sales transaction from£4 to£5 in Poundland stores, which take about 1.7 million transactions a week.
He revealed that, when he joined Poundland in May last year, its like-for-likes were down 3 per cent. They have climbed 4 per cent in the six months to September 30. McCarthy was previously managing director of Sainsbury’s convenience business.
He said: “People are voting with their feet and wallets, as we can see from the numbers.”
The retailer has increased sales by removing the Poundland brand logo from products and creating more than 40 sub-brands, such as Toolbox, as well as introducing new categories, including greetings cards. It stocks 800 brands, the majority of which are food and drink.
Its pick ‘n’ mix – a Woolworths rival – offers a selection of four products, including cans of cola and sweets, for£1 and generates sales of about£6.5 million a year.
The value retailer aims to launch a transactional web site in the next 18 months and is researching the idea through focus groups.
Poundland was bought by venture capitalist Advent International in 2002. Pre-tax profits increased to£5.6 million in the year to April 1, compared with£4.2 million the year before.
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