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RETAILING


we describe as our ‘amber’ stores. We’ve had to walk away from some because we couldn’t negotiate a rent that worked for us but there have also been others we have had successful negotiations with and where we are staying. Under the terms of the CVA, landlords could come back after six months and tell us if they wanted to pursue something else with another party, so we gave them some time.” Meanwhile, the business is now set for growth and Damian is already eyeing up locations for new stores; not ruling out the possibility of


re-establishing a Homebase


branch in a town it has recently exited. “We are looking at growth and I think there is potential for new stores. There are lots of geographies we’re not in that I think could accommodate a Homebase. There are big cities with opportunities for us to go back but in a different, better location.”


New opportunities There is also scope for smaller- format


outlets to maximise


opportunities for a Homebase outlet on the high street. However, Damian is quick to stress that this is a work in progress and his vision for Homebase is still being honed. “I think we’ve got the right sized stores now; 40,000-45,000sq ft is the right size for me but we could also test smaller stores in smaller locations, like high streets. If we are very clear about what we are and our proposition, it might be that the smaller format is a decorating shop or even a small kitchen shop. I don’t know at this stage – it’s all on the table. It’s my vision and I’m still shaping it.”


He has also learnt from past mistakes and is keen that Homebase remains focused on its core identity and objectives. “I want to be clear


www.diyweek.net


on that vision and, if we go down that route, not do what B&Q did with Holloway Road. I was part of that launch but the store was trying to be a jack of all trades and it didn’t work.” He


has also taken learnings


from the decisions Bunnings made during its time in the UK, including the decision to strip out kitchens and soft furnishings, expand Homebase’s offer significantly to match its Australian stores, and focus on an everyday low pricing structure. Discussing the


action


Damian and his team had to take once Bunnings moved out, he says: “We need to de-range a lot of the Bunnings range because it was too wide. They were very focused on tools and core DIY but they don’t have Toolstation or Wickes to compete with out [in Australia].” He continues: “Bunnings dropped millions of pounds-worth of stock on UK stores. We had stuff literally arriving in containers. It was a lot of stock and we had to open more distribution centres to cope…So, we needed to come in and get the range right and prices aligned – in some cases Bunnings had reduced price by 70 basis points but sales were going backwards!


“The everyday low pricing


structure didn’t translate in the way it did in Australia, where they had no competition. Over here, if you are promising the lowest prices, you have to match other retailers and online; everyone. It meant staff were changing prices on a daily basis and we even had different prices on different products in different stores. With paint for example, we ended up pricing by individual colour because one price across the board for that brand of paint wouldn’t work.” For now, a key part of Homebase’s strategy going forward is defining its identity and target customer


base, then in turn, shaping the business to meet that. “Homebase is a great brand but I felt it had lost its way,” Damian explains. “Even under the Home Retail Group (HRG), it was a mixed bag – a bit of Argos, bit of DIY, a bit of Habitat and then its concessions.”


New identity “We want to go back to being ‘decorative first’,” says Damian. “Through partnerships, we are making sure we are buying the right brands to fit with what our customer wants – such as Dulux, Farrow & Ball, Craig & Rose and Crown, to name a few.” He continues: “We want to be female-friendly, not


female only.


And, we now need to change the mindset of our teams in store, so that when a customer is buying a handle, light switch or electrical socket, it is part of the wider decorative project, not just a transaction. We want them to ask ‘is it the same colour palette?’, and so on – it all helps complete the look.” The re-introduction of that softer side of Homebase, which Bunnings


discarded, also sees


the re-instatement of in-store concessions. However, that doesn’t mean bringing back the same brands as before. In the past 12 months, Homebase has agreed concession partnerships with AHF Furniture and Carpets, Denby, Bedeck, Ponden Home, Tapi and Silentnight. These all help to further expand the range of furniture, soft furnishing and homewares now available in Homebase stores, as well as tasking these brands with providing ranges that Homebase doesn’t have to manage directly. Discussing the concessions previously seen in Homebase stores under HRG’s ownership, including Laura Ashley and Habitat, Damian says: “Under


HRG, concessions were competing, not complementing the business. We want complementary concessions in our stores now. For example, we will do hard flooring but don’t want to and will never do carpet, so we have Tapi to do that for us.” Damian is a firm believer that the success of the business lies in broadening its appeal and giving customers more reasons to visit. “Standalone is not the way forward, so we need to work out why they would come to a standalone home improvement store – and that’s where concessions and other additions to our offer come in.” The addition of Bathstore to the Homebase portfolio looks set to bring another concession in store and bolster the retailer’s bathroom offer. Homebase jumped at the chance to take control of the bathroom specialist’s website, intellectual property, as well as 44 stores and stock when Bathstore called in administrators three months ago. Not all of Bathstore’s 132 outlets


could be saved in the deal but Homebase will continue to trade a proportion of the outlets it took on, as Damian firmly believes that, “to keep a brand like Bathstore, you need to keep some standalone stores.” There is also potential to test Homebase stores in a smaller footprint in some of these site, if the location works for the brand. The biggest news right now is what will be happening in store at Homebase. Damian explains: “Bathstore will help to enhance our proposition. We’ve got some really great branding in kitchen, so, with Bathstore, we are looking at concessions, as it is a really strong brand in bathrooms and I believe people will travel for the offer. That’s where we can win!” There are plans to have a Bathstore presence in a large proportion of


06 SEPTEMBER 2019 DIY WEEK 13


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