Woolworths has identified 150 stores for relocation to bigger premises. The 803-store business has also identified 60 new locations for shops.
Chief executive Trevor Bish-Jones said the retailer would be opportunistic on relocations and openings, and would proceed on a store-by-store basis.
He said: 'What we are starting to do is tidy up the estate, because there are stores where we are clearly under-spaced. There are about 100 to 150 stores where we do not have the right combination of space and location. We might be too far off-pitch or we might be the wrong size.
'For example, at King's Lynn (Norfolk) we are trading out of 1,000 sq ft (95 sq m), but there's a shopping centre opening and we're taking a 14,000 sq ft (1,300 sq m) store there.'
Bish-Jones added that the average time a Woolworths store has been in its present location is 43 years. The retailer is investing£25 million this year to convert 50 outlets to its new 10/10 store type.
Last month, Woolworths revealed that it was downsizing its category-killing 80,000 sq ft (7,430 sq m) Big W stores and will sell space to other retailers to create a 35,000 sq ft to 50,000 sq ft (3,250 sq m to 4,645 sq m) format.
Asda, Next, Arcadia and Marks & Spencer are understood to have expressed an interest. A Woolworths spokeswoman said the retailer has held discussions with property directors of most big store groups. Woolworths will give an update on the Big W sell-off at its AGM on May 27.