If I had a hammer …

I am useless at DIY as anyone who knows me can testify. I can wield a hammer but other tools are beyond me, and whilst in my long ago youth I spent a golden summer as a brickie’s labourer, no skill rubbed off. So the irony of me being on radio this week talking about Kingfisher, B&Q and Screwfix is a good, family joke.

But the Kingfisher figures are interesting for a number of reasons. The headlines have all (rightly) been about the closure of 60 B&Q stores over the next two years, which given a store portfolio of only 360 is quite some axing of the network. This follows the announcement a few months ago from Homebase about their store closures. We seem to have fallen out of love for DIY.

But is it as simple as this? For some time B&Q have been making noises about having too many stores and too much space. The rush to big large format sheds in this market did privilege size over everything else and, just as in food, we are seeing the end of the “space race”. And yet in the same announcement Kingfisher noted that they were expanding their Screwfix store network in the UK (already at 395) by another 60 stores. Screwfix is targetted at a different market and is seen by Kingfisher as their “omni-channel” solution, but it also shows that a tightly defined format, with good cost control and a focused offering to what customers, want, when, can work (and indeed the trial of Screwfix in Germany is to be expanded).

In some ways this is all a little reminiscent of the grocery market. Large formats that thought they could go on for ever challenged by the rise of the internet, more tightly defined competition and costs issues in the heart of business. As I said on the radio the most startling part of the results for me was the following:

Of a total of 393,000 products sold across the company, only 7,000 products (representing 7% of sales) are currently sold in at least two operating companies. Of the 393,000 products, a large proportion relate to delisted and ex-promotional ranges which do not form part of existing retail planograms”

The scope to get the offer right across the company and to avoid the mistakes of the past would seem to be considerable. This might also perhaps be predicated on a more convincing internationalisation strategy. The results begin to suggest this might be happening (Kingfisher are in UK, France, Poland, Russia, Turkey and Spain and are adding Romania, Portugal and Germany but still extracting themselves from China).

It is a good question as to how much space this market needs in these changed consumer and DIY times, but it is worth noting that the figures show that the UK businesses (including B&Q itself) increased sales and profits over the year, and it was France that really let the company down. Nonetheless the changes in the UK have been flagged for a while and are geared at positioning the company for the new internet, convenience focused market, even in DIY.

Happy Easter!

 

 

About Leigh Sparks

I am Professor of Retail Studies at the Institute for Retail Studies, University of Stirling, where I research and teach aspects of retailing and retail supply chains, alongside various colleagues.
This entry was posted in B&Q, Catalogues, Closure, DIY, International Retailing, Internet shopping, Online Retailing, Screwfix, Space and tagged , , , , , , , . Bookmark the permalink.

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