Poundland is seeing a ‘shift’ with consumers migrating from major supermarkets as they shop around for the best deals in the face of rocketing inflation and the cost-of-living crisis.
Managing director Barry Williams told the BBC there is now a “definite dynamic” of shoppers making the move away from the traditional grocers to discounters, with customer numbers up by between 5 and 10% against the same period last year.
While some of that increase will be a return to pre-Covid shopping patterns, Williams says its clear that people are shopping around as they look to keep spending under control.
“I think you’re seeing a shift, a flight to value, if you like, from the traditional grocers, the major multiples, into the discount channel where we operate. Most discounters are performing better at the moment,” he said.
“What we’re definitely seeing is customers are prioritising essential areas of spend. It’s more around fast moving consumer goods, it’s more around food… perhaps a few less items in each basket.”
Research firm NielsenIQ recently revealed that one in four households were buying branded products at value retailers such as Poundland, B&M, Poundstretcher and Home Bargains as they kept an eye on the overall cost of their shopping basket.
READ MORE: Poundland focuses on fresh produce
Poundland’s sales of frozen food are also up, a category which Williams says tends to perform well at difficult times as it helps shoppers manage waste.
Williams said that inflation is “not over yet”, saying the main concern is that it won’t come back down. He says all discounters are key in acting as a “price anchor” for the market.
“Without a healthy discount sector, which we’re fortunate to have in this market, there is a danger that prices would remain at these inflated levels.”
Williams’ statements come as Poundland – which has more than 850 stores across the UK – is increasing the number of products it sells for £1 or less. Currently accounting for around half of the discount chain’s products, that figure is expected to be closer to 60% by the end of this week.
Williams added that Poundland’s £1 price point is being expanded to make it easier for customers to manage their budgets.
“Customers are being really mindful about how much they spend, this is a really easy way for them to control that spend as well.”
Two thirds of the products will be branded goods, although Williams has denied that suppliers would achieve the lower price points by resorting to ‘shrinkflation’.
“There’s not shrinkflation in this. But that was something that happened in the market a number of years ago. It’s certainly not what’s happening right now.”
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