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The Works plans major expansion
09.09.11 | Lisa Campbell
Discount retailer The Works has said it hopes to expand its stores in the UK by nearly 150, as well as growing its e-commerce business with the sale of e-books.
The retailer has opened 43 new stores this year—bringing its total to 304—but Garry Wilson, m.d. of parent company Endless LLP, said the chain could increase its overall portfolio to 450—an increase of 48% on 2010's figure
However, Wilson said the expansion wouldn't take place immediately. "I think we could have up to 450 Works stores in the UK, but with the economic climate, we are just being very careful at the moment. We are opening stores and have 10 in the pipeline.
"We are moving into new geographic areas with steady increases in the places where we are already represented," Wilson said.
"I think customers are increasingly looking for bargains. We are all under a bit more pressure, and spending a pound or two less on a book can make a difference," Wilson added.
In the 12 months to May 2011, The Works sold 21 million books and had overall sales of £114.4m—a total year-on-year growth of 7.9%—with like-for-like sales declining 1.5%.
"This is despite the significant impact that the pre-Christmas snow had on sales," the company said. It reported earnings before interest, tax, depreciation and amortisation of £10.5m, which it described as "another record for the business". The success was accredited to a re-focusing on books.
In the course of the year, the chain has focused on delivering "a strong value proposition" by improving its book and non-book product range, and said "the strong, well-established supplier relationships remain key to this, as well as seeking new supply opportunities to help broaden and strengthen our new, exciting and constantly changing range."
It will focus on improving the presentation of its shops and has established a number of "model stores" to be trialled and implemented across The Works network to standardise the layout of stores.
Kerry Hughes, commercial manager at The Works, said the company was now focussing on its e-commerce operation, and planned to revamp its website and start selling e-books. He said: "We can see long-term growth in this sector coming from e-commerce sales.
"At the moment we are really a bricks-and-mortar retailer. We will be growing internet sales substantially, but at the moment it is just a small part of the business."
To this end The Works has appointed Alistair Singer, former e-commerce manager at Hobbycraft, as e-commerce manager. The company also plans to recruit up to 10 more people to its e-commerce team in time.
Hughes added that the company was currently working on its promotions for the Christmas season. He said: "Last year our December was very much affected by snow and we had a number of stores close. However, this year we are very optimistic for Christmas."