Window display, Poundstretcher Wombwell (3 Nov 2011)

A few days ago, I blogged about how Poundstretcher in Newcastle needs to sell itself better in order to capitalise on the extra footfall generated by the opening of Discount UK opposite. I argued that the quality of Poundstretcher’s products, and its homewares in particular, is much higher than the shoddy advertising board and lacklustre store environment would lead shoppers to believe.

Sadly, presentation issues seem to permeate throughout the 350-strong chain. On Thursday last week I was touring South Yorkshire, and took the opportunity to visit the Poundstretcher in Wombwell, near Barnsley. The experience, I’m sorry to say, was very poor.

Poundstretcher, Wombwell (3 Nov 2011)

Externally, the shop at least ticks one box by featuring the latest Poundstretcher logo and fascia, which is increasingly replacing the disparate visual identities across the chain. However, the cluttered frontage of plastic containers and window posters offers neither an attractive shop window, nor views into the store. I was especially puzzled by the stacks of Andrex that filled the right-hand window – surely no-one can think that this creates an appealing first impression?

Inside, I was shocked by the state of the shop, which was generally untidy and had litter on the floor. Poundstretcher makes an unfortunate habit of piling display stock in the aisles as well as on the shelves, but much of the product on the floor here was in unpacked boxes. As well as making the shopfloor look like a stockroom, it would have been impossible for anyone with a pushchair or in a wheelchair to negotiate the store.

Wilkinson, Wombwell (3 Nov 2011)

If the branches are holding more stock than they can physically store, this is a supply chain issue that Poundstretcher’s bosses need to tackle. In the meantime, Wombwell’s shoppers can be forgiven if they opt instead for the shiny, modernised Wilkinson store over the road.

Former Woolworths (now Poundstretcher), Camborne (20 Feb 2011)

Though Wombwell is an established Poundstretcher branch, a lot of the same flaws apply even to the newly opened branches – many of which are in former Woolworths locations. As well as the stores in Camborne and North Berwick that I’ve mentioned before, I’ve recently paid visits to the new stores in Tiverton (one of the ex-Woolies sites acquired from Alworths, and opened in May) and Melksham (the last former Woolworths site in Wiltshire to reopen, in September last year).

Poundstretcher (formerly Woolworths and Alworths), Tiverton (9 Sep 2011)

Poundstretcher (former Woolworths), Melksham (9 Oct 2011)

While these new stores benefit from being generally cleaner than the older shops in the estate, there are still issues with products cluttering the aisles and an excess of both goods and promotional posters in the shop windows. In contrast, modern variety store retailers such as Wilkinson, Discount UK and Home Bargains manage to combine a strong value offer with stores that are still clean, bright and appealing, both inside and facing the street.

Poundstretcher’s product is strong (yet currently undersold), and the retailer is finally getting to grips with the historically confused brand that sees page 1 of Google Image Search bring up six different logo variations. Clean, tidy and accessible shops are a retailing basic, however, and Poundstretcher could do worse than to learn from – and pay some Soult-style visits to – its shinier value competitors.

Poundstretcher fascia, Camborne (20 Feb 2011)

Amid the gloom of Alworths’ collapse into administration last month, it seems that there’s now some good news. Retail Week is reporting that Alworths’ variety store rival, Poundstretcher, has bought 15 of the failed chain’s 17 stores.

Only the Llandudno and Evesham Alworths stores miss out – Poundstretcher already has a presence in the Welsh resort, and has recently been advertising jobs at what will presumably be a new store in the Worcestershire town.

Closing down sale at Alworths in Llandudno (4 Mar 2011). Photograph by Dave Roberts

The outcome seems like a positive result, saving the majority of Alworths’ jobs, and preventing the reappearance of empty stores on the high streets concerned. Indeed, the purchase includes several Alworths stores that had actually already closed their doors in the last few weeks.

The widely used ‘son of Woolworths’ tag reflected Alworths’ name and business model, as well as the fact that most – though not all – of its stores were former Woolies sites. Several more recent openings, including Newark, Maidenhead and Alloa, took over premises vacated following the collapse of the fashion chain Ethel Austin.

For Poundstretcher, the deal adds to the collection of ex-Woolworths stores that it has acquired already, which stretch from Scotland (North Berwick, Edinburgh) to Cornwall (Camborne) and Northern Ireland.

Former Woolworths (now Poundstretcher), North Berwick (2 May 2010)

The fact remains, of course, that Poundstretcher is itself a lossmaking business. Back in July, I remarked that Poundstretcher’s parent company had racked up total pre-tax losses of more than £33m across the previous four years, and Retail Week has subsequently argued that the chain faces an “uphill struggle” to compete against “an impressive array of apparently more sophisticated and profitable value players.”

Former Woolworths (now Poundstretcher), Camborne (20 Feb 2011)

Today, we can certainly celebrate the good news of Poundstretcher’s acquisition of Alworths. However, the really hard work will be Poundstretcher proving that its business model is still viable, relevant and – crucially – profitable.

Full list of Alworths stores acquired by Poundstretcher:

• Alloa
• Bellshill
• Cosham
• Cupar
• Didcot
• Forfar
• Hertford
• Maidenhead
• Newark
• Newhaven
• New Milton
• Swadlincote
• Tiverton
• Warminster
• Wokingham.

High Street, Inverness with former Woolworths store (1 May 2010)

One of the hazards of visiting so many places – and taking so many photos of shops – is that I end up with far more potential blog topics than I ever have time to write about.

Some shots that I’ve had gathering dust since the beginning of May are from when I holidayed in the Scottish Highlands. Old Woolworths – or, in fact, any shops at all – are hard to come by in the wilds of Sutherland, but I did manage to bring in a couple of Woolies visits on the way back home.

Former Woolworths, Inverness - prior to Poundland moving in (1 May 2010)

First stop was Inverness, where the large former Woolies store at 13-15 High Street (store #233) was still empty when I visited. As Woolworths, the store had traded from the site for more than 80 years, opening on 11 September 1926 and undergoing a ‘reskinning’ in 1964 to give it its current, ‘modern’ appearance.

c1960 postcard view, prior to reskinning

However, the news that Poundland would be moving into the ground floor of the five-storey property – opening a second Inverness store alongside its existing Eastgate shop – had been reported just the day before my visit. The new Poundland store is now trading, having opened last month.

North Berwick's characterful town centre (2 May 2010)

Almost at the other end of Scotland, the old Woolworths in the delightful seaside town of North Berwick, East Lothian (store #804) – which has been taken over by Poundstretcher – is a much more modest property.

Former Woolworths (now Poundstretcher), North Berwick (2 May 2010)

Despite Poundstretcher’s travails – blogged about back in August last year, and reflected in total pre-tax losses for its parent company, Instore, of more than £33m across the last four years – the retailer has picked up quite a few old Woolies stores, including, among others, sites in Camborne, Whitchurch, Hyde, Edinburgh, and several in Northern Ireland. These, along with the rest of the retailer’s estate, are adopting a revamped Poundstretcher fascia, following the abandonment of earlier plans to brand the entire chain as Instore.

These recent acquisitions have helped Poundstretcher to increase its store estate to about 320, still short of the peak of almost 340 that was reached in 2002, but an improvement on the 300 figure from early 2006. However, with Home Bargains and B&M Bargains expanding aggressively on one front (the latter now up to 197 stores, from just 10 in 2000), and single-price retailers Poundland and 99p Stores hammering away at another, it’s hard to know quite where Poundstretcher sits.

As the Retail Week Knowledge Bank sagely concludes, “the serious strategic dilemma facing [Instore's] management is that neither the Instore nor the Poundstretcher format is yet showing any obvious signs of making the required impact on enough consumers for the business to achieve sustainable long-term profitability despite all efforts.”