Kingfisher buoyed by strong Screwfix sales
DIY specialist Kingfisher reported a positive set of results for 2016/17, driven by impressive l-f-l sales from Screwfix (13.8%), which opened 60 new outlets and saw strong growth from its specialist trade desks and online. Kingfisher announced it will prioritise investment in the Screwfix brand as part of its five-year transformation plan, with a target of 700 outlets.
Total sales for B&Q fell as a result of its store rationalisation plan, with the closure of 65 stores since February 2015. With this plan now complete, B&Q can focus on its existing estate by rolling out its new ‘Big Box’ format, which features new product ranges and aims to improve the customer experience. The retailer also opened its first convenience store in north London in March 2017, as it trials this format, which is aimed at further increasing its reach.
However, even with these positive results for Screwfix, the business environment will no doubt be challenging for Kingfisher in the immediate future, with a slowdown in housing transactions set to dampen demand for some products. 2017 will be more competitive with Wickes continuing its store expansion programme, Bunnings will compete more on price, and the general merchandisers are expected to continue to grow share.
Kingfisher has been innovative by investing in a new format convenience store, focusing on the growing digital market, and also implementing strategies from the Kingfisher One programme. These initiatives will place the group in a strong position and allow B&Q and Screwfix to counter the immediate uncertain trading conditions.
Source: GlobalData 22 March 2017