Poundland, the UK's best known 'pound shop' chain, is possibly heading for an IPO and definitely heading for growth. Strong sales (£880 million at the March 2013 year end) has driven the firm to open 1000 stores in the UK and Ireland in the coming years; currently there are 458 stores in both countries.
Likewise, the situation is much the same for Aldi, the German discount supermarket chain. Next month, it will open its 500th Aldi store (and more subsequently), based on strong performance in the past year (pre-tax profit of £157.9 million in 2012, an increase of 124% from 2011). Some of these stores will be based in more affluent areas in the UK to reflect changing demographics of the store's customers. It will also create premium lines for Christmas and other products to draw in sales. In fact, Aldi is the UK's fastest growing supermarket, challenging the likes of Tesco and Asda. For now however, Aldi only has 3.7% of the market share whereas Tesco holds 30%.
There are a few factors driving the growth of large discount retailers. Aldi, for example, partially appeals to customers due to their sourcing of local produce from meat to fruit & veg. More generally, the discount retail sector is becoming more mainstream and more 'integrated' into the industry. The fact that the mindset for many consumers at present is to spend less where possible also contributes to this somewhat 'boom'.
 |
| Will you be shopping here? |
We've seen a string of high street casualties but Aldi and Poundland - which stocks the goods we depend on for daily living - certainly won't be added to that list.
JH
No comments:
Post a Comment