Barclay brothers plan to bring Woolworths back to the high street
13:27 | 23.11.09
Woolworths could return to the high street under a plan by Shop Direct group, the owner of Littlewoods, to establish a chain of 200 stores.
The high-street institution closed this year, at the cost of 27,000 jobs, and left more than 800 empty premises. However, a year after Woolworths fell into administration, Shop Direct, which owns the Woolworths name, believes that there is room for up to 200 stores under the famous red fascia.
The home shopping retailer, owned by Sir Frederick and Sir David Barclay, bought the name from the administrators and resurrected it online. It wants to hear from possible franchisees. It is not considering managing the stores itself.
Mark Newton-Jones, the chief executive, said: “In the new year, we will consider approaches from interested third parties. We believe it could be a successful chain of up to 200 stores, supported by the buying power of the Shop Direct Group.”
Shop Direct paid £7 million in February for the Woolworths brand name and Ladybird, its childrenswear brand. It has focused on toys and family entertainment, steering away from hardware and homewares.
Shop Direct, which owns the Great Universal and Kays catalogues, hoped to capitalise on the Woolworths brand without the burden of its 807 stores, not to mention its £385 million debts. It had poured cold water on the idea of Woolworths returning as a bricks-and-mortar chain. At the time of the purchase, Mr Newton-Jones predicted further decline for secondary high streets.
The scale of Shop Direct will give any Woolworths franchise an advantage over the stores that have been founded in its image in former stores because it will able to source goods directly, rather than going through wholesalers.
Shop Direct has fired a warning shot at one such store, Alworths, which was set up by Andy Latham, a former Woolworths executive. Shop Direct believes that the name is too close to Woolworths.
Alworths’ first store opened this month, on the 100th anniversary of the Britain’s first Woolworths opening, in Didcot, in the Oxfordshire town’s former Woolworths store. It is managed by the store’s former manager. Mr Latham hopes to have five shops open in time for Christmas.
In Dorchester, a Woolworths store manager opened a shop named Wellworths on the site of her former work place. In Stornoway, in Scotland, a former Woolworths store was reopened as Wee W.
Shop Direct rebuffed an offer from Tony Page, a former commercial director of Woolworths, to license the name. He wanted to reintroduce the chain to the market towns where it had always remained profitable.
Mr Page said yesterday: “It’s something I would like to consider. There’s a role for Woolworths on the high street.”
Seventy-five per cent of the 807 former Woolworths stores have been let, according to CB Richard Ellis, the property company.
Discount stores, such as B&M Bargains and 99p Stores, are leading the charge into the former Woolworths stores. 99p Stores has taken 52 of the stores, while Iceland, the frozen food retailer, has taken nearly 50. Poundland has taken leases for 27 of the premises.
The disappearance of Woolworths has also prompted the supermarkets to expand their non-food ranges, especially in the run-up to Christmas, which was a key time of year for Woolworths.
Article from http://www.propertyweek.com/story.asp?sectioncode=297&storycode=3153818&c=1
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