Poundland is set to implement a new pricing strategy in its UK stores, simplifying the cost structure to £1, £2, and £3 tiers. The discount retailer, now under the ownership of investment firm Gordon Brothers, is reverting to its original pricing model. The transition to the new pricing system will occur gradually across all Poundland stores in the UK, following a successful trial in 17 West Midlands stores.
During the trial phase, prices were decreased significantly, with a focus on popular customer items. The proportion of products priced at £1 rose to over 60%. Once fully implemented, approximately 60% of grocery items will be priced at £1, 20% at £2, and 20% at £3.
Various products including household, grocery, and confectionery items will be available for £1, such as Pink Stuff Paste (850g), Cif Lemon Cream cleaner (500ml), Heinz Baked Beans (415g), John West Tuna (125g), Haribo Starmix (160g), and Werther’s Original (135g).
The new pricing structure will first apply to snacks, ambient drinks, pet food, and household goods, with other categories like grocery items, confectionery, health and beauty, and chocolate, biscuits, and cakes transitioning by the end of September.
Poundland reports a reduction of over 25% in shoplifting incidents in trial stores since eliminating higher-priced £5 items. A regular shoplifter at one store expressed dissatisfaction when the item they frequently stole was no longer stocked.
Barry Williams, Poundland’s managing director, expressed confidence in the success of the new pricing model based on positive customer feedback from the trial phase. The company recently avoided administration after receiving approval for a restructuring plan in the High Court.
As part of the restructuring, Poundland plans to close 68 stores, impacting around 1,000 employees. Additionally, the frozen and digital distribution site in Darton, South Yorkshire, and a warehouse in Springvale, Bilston, West Midlands, will be shut down.
Furthermore, Poundland will cease online sales on its Poundland.co.uk website next month and discontinue its Perks app. Williams thanked the Court and creditors for their support during the process, emphasizing the commitment to assisting affected employees while focusing on revitalizing Poundland’s growth and customer experience.