Home Bargains is a fast-growing discounter that specialises in selling branded general merchandise and food at low prices. Around 30% of the range comprises clearance lines.
The retailer trades through more than 570 stores across the UK, and is working towards 800-1,000 UK stores over time. Expansion in the South has been a recent focus although in January 2023 the retailer acquired varierty discount retailer Quality Save, which has 21 stores in the north of England.
Home Bargains is very much focused on minimising costs across all parts of the business and most of its IT systems have been built in-house.
However, it has invested considerably in its distribution capabilities in order to support its planned growth and has been looking to upgrade its store systems.
Benefitting from its ‘essential retailer’ status, Home Bargains continued to flourish during the pandemic. However, growth was more muted in its most recent financial year. The discount specialist notched up sales of £3.4bn in the year to end-June 2022, a 2.4% increase on the year before. Pre-tax profit margin was 8.6% in FY2021, down from a record 11.8% the previous year. This remains a high level for a value retailer.
The family-owned retailer has been in business for over 40 years and continues to be run by its founder, Tom Morris, and his brother Joe.
Innovation rating: 1.5