Poundstretcher boss Aziz Tayub has claimed that prices are “cheaper than 100% of the discount sector” as shoppers increasingly turn to value retailers such as Home Bargains, B&M or Poundland for their grocery needs.
The Leicestershire-headquartered value retailer has said it will be “keeping price rises to a minimum” as it continues to target cash-strapped consumers shopping around for the best deals amid high inflation and plummeting consumer confidence during the cost-of-living crisis. It aims to keep price rises to between 5% to 10% this year.
Poundstretcher CEO Aziz Tayub also claimed that the retailer’s prices have “gone down significantly” compared to last year, despite suppliers hiking prices “pretty much every month”, citing the example of one food supplier which has put prices up 125%.
“We have reduced prices and we are the most competitive. Our prices on toiletries for example are still cheaper than 100% of the discount sector,” he said.
“On average our prices have gone up 5 to 10%, but we’ve been saving a lot of costs and have been able to keep price rises down as much as possible. Price rises have occurred in many retailers due to increases in freight costs and raw materials, mostly from UK manufacturers putting up prices pretty much every month.”
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The chain has been on an upward trajectory following a CVA restructuring a couple of years ago.
The most recent accounts filed at Companies House show that the business made a pre-tax profit of £88 million in the year to March 2021, up from a loss of £45 million in the previous 12 months. Turnover dropped 20% over the same period, down to £325 million from £412 million.
Unofficial figures show pre-tax profits for the full year to March 2022 are expected to be around £40 million. Sales for the same period have dropped to £277 million, following a restructure which closed a number of loss-making stores.
“The latest accounts to March 2021 are better than we expected,” said Tayub, describing current trading as “challenging” due to supply chain issues and “customers holding back on spending money”.
All Poundstretcher staff were given a 10% pay rise at the start of the year, thanking them for their commitment to the business.
The family-owned retailer – which currently has 338 stores across the UK – is continuing to restructure its store estate and expects to have between 360 and 370 stores by the end of the year.
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1 Comment. Leave new
Not the cheapest by any stretch of the imagination. Also quality of goods has gone downhill. Far to many short life or past “Best Before” dated goods. The shop started well but it is clear that management have taken their eye of the ball, whilst other retail store like Home Bargains lead the way