Poundland to buy out 99p stores

[cwathen]

Is this all just a ploy to increase the value of 99p Stores' stock by a penny per unit? Because that's probably a hell of a lot of money in total.

I do wonder just how much margin there is even at 99p/£1 - last year when a 99p store opened in Torquay, Poundland immediately dropped to 98p, 99p store then dropped to 97p leading to Poundland dropping to 96p etc etc with one of them undercutting the other every few days. IIRC one of them eventually got down to 89p. The whole situation lasted about a month until both stores went back to their full price.

[Gavin Scott]

I used to spend a lot of time at trade wholesalers. You'd be staggered at the quantity and breadth of products which sold for 35p - not just moulded plastic soap dishes and the like - you could buy a 3m telephone extension cord for that price and sell it for £1.99. Keep in mine that was a wholesale price and will have already have been marked up. Poundland et al will be buying direct from manufacturers so will gain a better margin.

[Alexia]

This is where calling your store "Poundland" and "99p" falls down....cos you're kinda tied to that. I guess it kinda works both ways in that they sell products that would normally retail for >£1 for £1.

Home Bargains and B&M Bargains have it down.

[Martin Phillp]

To keep prices at 99p/£1 you have to reduce either the size of the contents or remove them.

For example, a packet of Tetley One Cup tea bags used to be 100 bags, then 88 and now 76 bags.

Also I remember reading something from 99p Stores that they'd subsidise the 1p off the product.

[bilky asko]

Home Bargains and B&M Bargains have it down.

I never thought I'd agree with you so wholeheartedly. They've sewn up that side of the market better than "Discount UK" or whatever it's called. And B&M have booze - so much booze.

A good deal of the food items are made for Poundland in specific sizes (three packs of Dairy Milk being the most obvious example), so one would presume their margins are dictated by the pack quantities they ask for.

The real value (in any of the discount stores) is the short-dated stuff. 4 bottles of Frijj milkshake for £1? Yes please.

[Alexia]

I go to Aldi for my booze. Bottles of ale (St Austell / Badger / London Pride etc) £1.49 each. Compares favourably with T*sco's 3-for-£5 offer.

[Martin Phillp]

A good deal of the food items are made for Poundland in specific sizes (three packs of Dairy Milk being the most obvious example), so one would presume their margins are dictated by the pack quantities they ask for.

Warburtons do a special loaf range for Poundland. However with both Tesco and Sainsburys reducing the price of a Hovis loaf to 78/75p, this will hit Poundland.

I regularly pop into Poundland for Heinz soup. 2 for £1 is better than 78p in the supermarkets.

[JAS84]

The real value (in any of the discount stores) is the short-dated stuff. 4 bottles of Frijj milkshake for £1? Yes please.

Ooh, I love those, but the best I ever see is buy one get one free or 50% off in the main supermarkets - works out about 65p each on such deals. Where was this 4 for £1 deal?

[cwathen]

I used to spend a lot of time at trade wholesalers. You'd be staggered at the quantity and breadth of products which sold for 35p - not just moulded plastic soap dishes and the like - you could buy a 3m telephone extension cord for that price and sell it for £1.99. Keep in mine that was a wholesale price and will have already have been marked up. Poundland et al will be buying direct from manufacturers so will gain a better margin.

On the subject of cables, Poundland lately has started knocking out branded Belkin cables for a quid which are pure £12.99 territory in a 'real' shop - even the awesome Mr. Ashen noted this at the end of one of his poundland specials last year (youtube.com/ashens - well worth a look).

I never thought I'd agree with you so wholeheartedly. They've sewn up that side of the market better than "Discount UK" or whatever it's called. And B&M have booze - so much booze.

Let's not forget Savers whilst we're on it - as well as the somewhat random addition of girly cheap booze in a shop selling mainly third rate cosmetics (lots of imitation lambrini and pre-mixed cocktails which ironically seem more popular with the special brew drinking middle aged male subhuman scrote type than the target audience), but their chilled soft drinks are amazing - genuine GB-stamped Coca Cola Company/PepsiCo drinks selling for 29p / can which are anywhere from 80p-over a quid at a 'real' shop)

[Martin Phillp]

Poundland/Poundworld also do HDMI cables, you can't tell the difference. A few years back I thought getting gold plated Scart's in Wilko's for around £3 were great.

[cwathen]

Poundland/Poundworld also do HDMI cables, you can't tell the difference. A few years back I thought getting gold plated Scart's in Wilko's for around £3 were great.

To be fair, whether you truly see the benefits of decent cables on consumer-grade kit is highly debatable anyway. When I was in electrical retail I sold many £80 HDMI and SCART cables on the basis of their superior construction and connection quality, but the fact remains that all our equipment in store was connected up with bargain basement black plastic and aluminium leads and the customers were happy enough with the performance out of these leads to buy the equipment.

In 2009 when SCART had fallen out of favour on new equipment, the Ixos rep came round handing out what were ultra high-end £150 leads for free as Christmas presents to clear the stock - I still have one in service connecting up my PVR to my TV, and there is absolutely no appreciable difference between it and the cheap black plastic lead which connected it up before.