B&Q Owner Kingfisher Tests Convenience-Store Format to Lure Shoppers
(Bloomberg) -- Kingfisher Plc, owner of the B&Q and Screwfix home-improvement chains, is testing a convenience-store format to attract shoppers turned off by big-box locations and show investors that its turnaround strategy is on track.
The trial express store, GoodHome, will be a digitally led operation housed in smaller shop units on main streets, Chief Executive Officer Veronique Laury said Thursday in London. A departure from B&Q’s large warehouse-style outlets, the convenience format will make it easier to shop in densely populated areas, the company said.
The new developments come after Kingfisher reported a mixed performance in the first quarter and as Laury prepares to leave the group. Four years ago, she launched her One Kingfisher plan, aimed at uniting purchasing and product lines to cut costs and make the shopping experience better and easier to navigate. However, the program has been hurt by lackluster French business, high implementation costs, tough competition in the U.K. and falling profits.
“It is sort of like deja vu for me, as I have heard many iterations of promises to overhaul product ranges and increase the sales of own brand items from Kingfisher over the years,” said Tony Shiret, a retail analyst at Whitman Howard. Limited parking may hurt the effectiveness of the GoodHome format, he said.
Kingfisher fell as much as 2.2% in London.
The retailer has opened one GoodHome store in southwest London and plans to open another one nearby. Products and services sold under the GoodHome brand will focus on common home-improvement projects. They’ll be offered under that label in the company’s other stores, which include the struggling Castorama chain in France.
Customers at GoodHome stores will be able to order products through digital screens and then collect them at the counter. They can also order items online and have the products delivered to an express store for collection the following day.
Laury said in March that she “could not commit to another five years” at Kingfisher, but has given no departure date. Profit fell 13% last year to 693 million pounds and the CEO’s promise to deliver an additional 500 million pounds ($644 million) of profit a year by 2021 has been abandoned.
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