The Works to open 60 new stores in 2016

The Works to open 60 new stores in 2016

The Works, a deep-discounting chain specialising in books, toys, gifts, stationery and arts and crafts, is accelerating its expansion and set to open around 60 stores this year.

The chain, which already owns over 310 stores, is set to open more than one new outlet a week in 2016 in the UK, according to its commercial property specialist Colliers International.

It has begun the expansion in Scotland, by acquiring two 10-year leases on properties - one 2,750 sq ft outlet at Clyde Shopping Centre in Clydebank and another 1,681 sq ft new store at East Kilbride Shopping Centre.

The Works also renewed the lease for its popular store on Inverness High Street (4,855 sq ft across three floors) for another five years.

Ross Wilkie, director of retail with Colliers International property agent in Scotland, said: “We are delighted to be helping The Works with its expansion plans, and are confident that we can secure further locations throughout the year, as there are still many gaps in the market where our client is not represented.

“The chain's expansion is the latest sign of a pick-up in the retail sector which we are seeing in Scotland, which reflects growing consumer confidence.”

Last May venture capitalist company Endless became a majority shareholder in The Works at the same time that its former executive chairman Anthony Solomon stepped down.  At the time, Garry Wilson, managing partner for Endless, said Solomon had left The Works in "an incredibly healthy position with exciting prospects going forward". 

It also launched a click and collect service in 2015.

According to results filed at Companies House, The Works saw a 10% increase in like-for-like sales and an 11% increase in total sales to £141.7m for the year ending 52 weeks to 26th April (2014: £128m). The increase was driven by an "acceleration of the online business and roll out of the new store format", which are both "growth initiatives", according to the company.

It opened 18 new stores during this time and rebranded another 36, supplemented by the launch of click-and-collect online. It's loyalty card programme now has 500,000 members.

A "strong sales performance" combined with "a strong culture of cost control" was credited for £9.4m earnings before interest, tax, depreciation and amortization (EBITDA), representing 15% year-on-year growth (£2014: £8.1m).  

Operating profit was £6.9m for the year ending 26th April 2015 compared with £6.0m a year earlier.

The Works' number of staff on the shop floor decreased from 1,084 in 2014 to 1,047 in 2015, while the number of warehouse staff jumped from 73 to 87 and management from 96 to 112, between April 2014 and April 2015. The highest paid director leapt from £200,000 in April 2014 to £425,000 by 26th April 2015.

The report stated that the business would continue to invest in "key infrastructure projects". Out of its 313 stores, 98% are profitable, it added.