Wilkinson Hardware Stores Ltd.

views updated

Wilkinson Hardware Stores Ltd.

P.O. Box 20
Roebuck Way
Manton Wood, Worksop
United Kingdom
Telephone: (44) 01909 505505
Fax: (44) 01909 505777
Web site: http://www.wilko.co.uk

Private Company
Incorporated: 1930
Employees: 21,000
Sales: £1.12 billion ($1.9 billion) (2005)
NAIC: 444130 Hardware Stores

Wilkinson Hardware Stores Ltd. is one of the United Kingdom's leading retailers catering to the hardware and do-it-yourself (DIY) sector. The company, headquartered in Manton Wood, Worksop, operates more than 265 stores throughout the United Kingdom, and boasts more than 21,000 employees. The company operates several store formats, varying in size, with an emphasis on large-scale 'superstores'. Unlike many of its competitors, Wilkinson stores are typically located in the country's downtown 'High Street' areas. Because of this proximity to its customers, Wilkinson stores tend to feature a broader product assortment than typical hardware stores.

The company's product assortment goes beyond DIY, hardware and decorating and garden items, to include toiletries, household cleaners, kitchen goods, "home living" including bedding and other textiles, pet foods and other pet care items, stationery, and even confectionery. Other items include perfume and fragrances and computer supplies. In this way, Wilkinson Hardware operates as much as an old fashioned variety store as a hardware store. These product categories nonetheless all maintain a common theme—Wilkinson's dedication to remaining a low-priced, discount-oriented retailer. As part of this effort, the company also sells its own branded goods, which account for a significant proportion of the company's sales.

Owned by the founding Wilkinson family, Wilkinson Hardware has been growing steadily into the mid-2000s, averaging 20 new stores per year for more than a decade. The company has targeted an expansion of its retail network to 370 stores by 2010. Tony Wilkinson, son of the company founder and chairman since 1972, retired in 2005, making way for the latest generation under daughter Lisa Wilkinson and niece Karin Swann. In 2005, Wilkinson Hardware posted total sales of nearly £1.12 billion ($1.9 billion).

SINGLE STORE BEGINNINGS IN 1930

Wilkinson Hardware Store was founded by J.K. Wilkinson, who opened a small shop selling hardware items and other variety goods on Charwood Street, in Leicester, in 1930. Wilkinson, described as a canny businessman, founded his business on a simple, yet effective philosophy which was to sell quality goods at discount prices. That strategy quickly paid off, establishing the Wilkinson store as a local favorite. Within a year, Wilkinson had already opened his second store. Yet, as granddaughter and future company director Karin Swann told Worksop Today : "I don't think he every dreamed it would grow as big as it is. He simply started off wanting to give people great quality goods for a good price. That way of thinking has remained ever since and it has brought us to where we are now."

By the end of the 1930s, J.K. Wilkinson already operated seven stores. Following World War II, Wilkinson continued to expand the business, opening a number of new stores. In 1960, Wilkinson was joined by son Tony Wilkinson, who had started his working life at the F.W. Woolworth retail group. The younger Wilkinson worked at a number of positions in the Wilkinson organization, and named to the company's board of directors in 1963. By the late 1960s, the younger Wilkinson had emerged as the driving force of the group, and in 1972 he replaced his father as company chairman. A number of other members of the Wilkinson family were also active in the company, including Wilkinson's younger sister, Barbara.

By then, Wilkinson had grown to a network of 20 stores. The company's growth required it to expand not only its headquarters, but its distribution facilities as well. In the late 1960s, the company moved to Worksop, in Bassetlaw, constructing a new head office and distribution center. That site also became the home of the group's test store—a full-scale mockup of a typical Wilkinson store, which enabled the company to test new floor plans, formats, and products.

Wilkinson continued to spread strongly throughout the Midlands and northern regions of England during the 1970s and 1980s. The company's commitment to low prices during a difficult economic climate helped it attract a growing number of customers. As part of its continued efforts to remain a price leader, the company began developing its own branded product range, offering customers a choice of quality, yet discounted products, as well as the major name brands. Wilkinson's own branded line became an important source of revenues for the company, accounting for as much as 35 percent of its sales.

Into the 1990s, Wilkinson remained committed to its center-of-town locations, despite the growing success of out-of-town commercial zones and the rising number of competitors turning to ever-larger superstore-formats. Indeed, the trend offered a number of opportunities for the company to acquire new sites in the country's town centers. In 1991, for example, the company purchased the freehold to the former Marks & Spencer department store site in Dudley. The strong demand at the store led the company to invest in its expansion, carrying out a £250,000 extension in 1994.

NATIONAL RETAIL HARDWARE LEADER IN THE NEW CENTURY

By then, Wilkinson had already entered into a new growth phase, becoming one of the United Kingdom's fastest growing retailers. Throughout the 1990s and into the new decade, Wilkinson achieved an impressive growth record of an average of 20 percent per year. Part of the secret to the company's success was its willingness to expand its product offering beyond the traditional hardware and DIY market. As such the company's store shelves featured a wide range of household-related items, including cleaning and kitchen products, textiles and clothing, pet care products, and personal hygiene and personal care items—such as perfume. Wilkinson also added a book section, with titles ranging from DIY guides to children's books and fiction. The wider assortment, of more than 25,000 items, helped stimulate traffic in the company's stores. As such, the company's customers typically visited the store an average of two to three times per week.

By mid-1999, Wilkinson operated nearly 160 stores, backed by its one million-square-foot Worksop distribution center and a trucking fleet of more than 500 vehicles. Most of the company's business, however, remained concentrated in the United Kingdom's Midlands and northern regions. As it approached the new century, the company now targeted expansion onto a truly national level, with plans to open new stores in the southeast and Wales.

COMPANY PERSPECTIVES

At the heart of Wilkinson is a desire to provide the ultimate shopping experience for our customers and a rewarding place to work for our team members. Our Vision for the business is simple: We are committed to providing our customers on the high street with quality products at everyday low prices and friendly service that exceeds expectations. We invest in team members, logistic and information technology to make this family business a great place to work and shop.

In the summer of 1999, the company announced its decision to build a new distribution center in Wales, replicating the Worksop site and offering more than 850,000 square feet of warehousing space. This site, like the Worksop center, offered support for as many as 300 stores. Construction began on the site in Magor in 2000, with operations launched in September of that year. At the same time, Wilkinson opened its first stores in its new territories, with a target to reach a total of 250 stores by 2003.

Through the mid-2000s, Wilkinson's expansion effort called for the addition of some 20 stores per year. The success of its new store openings encouraged the company to raise the bar of its growth targets. In 2003, for example, the company set a new goal of 300 stores by 2006, and at the mid-decade the company hoped to operate as many as 370 stores by 2010.

In addition to new store openings, the company also continued to fine-tune its portfolio, transferring existing stores to larger sites—such as its Lincoln store, which took over a site formerly occupied by C&A in 2001. The company remained committed to its city-center market—particularly as this market had been undergoing a transformation of sorts at the turn of the century. With the growing number of out-of-town shopping centers draining people from the country's city centers, a number of city councils had begun to fight back, promoting the development of new large-scale shopping centers within the city center. An example of this could be found in Basildon, in the southeast, which built one of the country's largest city center-based shopping areas, Eastgate. And extension to this site, West-gate, fitted in with Wilkinson's own expansion plans, and the company opened a store on that site in 2000.

Wilkinson continued adding new locations into the middle of the decade. It added stores in Stroud, Knowle, Armley, West Ealing, Barry, Corby, Brentwood, and Derby in 2005. Most of these were small or medium format, although the Corby store followed the company's extra large format. Into mid-2006, Wilkinson's new store program added locations in Chelmsley Wood, Longton, and Clowne. By then, Wilkinson had come under new family leadership, after Tony Wilkinson retired as chairman. Taking his place was niece Karin Swann, who had joined the company in 1994, and daughter Julie Wilkinson, who became a company director. With sales of more than £1.1 billion and an ambitious growth strategy, Wilkinson planned to remain one of the United Kingdom's leading family-owned retailers into the new decade.

PRINCIPAL SUBSIDIARIES

Wilkinson Hardware Stores Ltd.

PRINCIPAL COMPETITORS

Kingfisher plc; BandQ plc; Saint-Gobain plc; Focus Ltd; Homebase Ltd; Facey Commodity Company Ltd; Heiton Group plc.

KEY DATES

1930:: J.K. Wilkinson opens his first hardware store in Leicester; within a year, he opens a second store and by the end of the decade operates seven stores.
1960:: Son Tony Wilkinson joins company.
1963:: Tony Wilkinson becomes a company director.
1969:: Wilkinson moves to new site in Worksop and builds a one million square-foot distribution center.
1972:: Tony Wilkinson becomes company chairman; Wilkinsons now operates 20 stores.
1999:: With nearly 160 stores in operation, Wilkinson targets expansion into Wales and southeast England.
2000:: Company opens second distribution center in Magor, Wales.