B&M Accelerates Expansion After Business Lockdown Sales Boom

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Discount retailer B&M stepped up expansion plans after its stores, selling everything from canned and frozen foods to wallpapers and bedding plants, became a locking sensation.B&M said its UK sales have grown by almost 20% in the past three months despite the lack of a website. The retailer is taking advantage of big changes in spending as out-of-town business parks gain popularity during the pandemic.

To capitalize on the success, he now plans to open up to 45 stores by March. It had previously planned to open around 30.

B&M, which was promoted to the FTSE 100 this month, said the strong sales picture meant it now expects to post underlying half-year profits of £ 285million. This compares to his previous forecast of between £ 250m and £ 270m and this is the second time he has increased his profit forecast this year.

Simon Arora, Managing Director of B&M, said his business model “is proving to be well suited to changing customer needs”.

Discounters such as B&M, along with private rivals Home Bargains Wilko and Poundstretcher, have fared far better than many large retail chains after being allowed to remain open during the UK’s 12-week lockdown.

The no-frills chain is a far cry from its roots in Blackpool where it was founded by Malcolm Billington in 1976. The initials originally stood for Billington & Mayman, then Bargain Madness. When it was acquired by the entrepreneur brothers Arora in 2005, it only had around 20 stores and was in loss. Today, B&M has more than 600 stores in the UK and generates over £ 3 billion.

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Businessmen transformed B&M, which followed a similar formula to the now-defunct Woolworths chain, introducing housewares, toys, toiletries and even pet supplies and clothing. They sold a stake to private equity investors before going public in 2014. The low budget retailer is still headquartered in Luxembourg.

B&M shares, which changed hands for as little as 256p in March, have doubled in value in the past six months. On Tuesday, shares closed up 4% at a new high of 510p, giving the discount chain a market value of over £ 5bn – more than double that of Marks & Spencer.

Amy Higginbotham, retail analyst at GlobalData, said the UK lockdown provided the conditions for B&M to thrive. Its low prices have wowed shoppers during the current economic uncertainty, while its out-of-town department stores “allow shoppers and staff to meet social distancing guidelines,” she said..

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