Liverpool-based value retail giant B&M says it is attracting more affluent shoppers for the first time – people who ‘may not need a bargain, but certainly enjoy a bargain’. Tony McDonough reports
Affluent shoppers are now flocking to value retailer B&M for the first time, the company says.
Liverpool-based B&M operates 686 stores across the UK and for the last few years its low-price offer has appeared to mainly low income shoppers. However, the business now says its appeal is widening to the more well-heeled customer.
Last week, B&M reported its financial results for the half year to September 25, reporting revenues close to £2.7bn from its 1,097 stores in the UK and France, up 1.2% on the same period last year.
Revenues from the 686-strong B&M UK estate were up 1.3% to £1.9bn. B&M stores in France saw a significant uplift of 10.6% to £155.4m. Group pre-tax profit rose 2.4% to £241.4m.
In the report the company offered an insight to what brings people into its stores and their shopping habits once they are inside. It said: “B&M offers constant newness with typically 100 new lines added each week, predominantly across general merchandise categories.
“This remains a crucial part of the appeal of B&M, as customers often make impulse purchases in store regardless of their initial reason for visiting.
“The combination of ‘big brands, big savings’ alongside increasingly popular own-branded general merchandise ranges, such as homewares and seasonal, makes for a compelling customer proposition.”
And what was also fascinating was the increasing number of people on higher incomes who were belatedly flocking to the store. A similar phenomenon has been observed previously at low-price retailers Primark and Aldi. B&M added: “Last year, B&M saw a number of new customers discover the brand.
“In particular, the socio-economic profile of these customers included large numbers of middle-income households, suggesting the appeal of value retailing was broadening to encompass slightly more affluent consumers who may not need a bargain, but certainly enjoy a bargain.”
The popularity of gardening products during pandemic lockdowns may have been one of the reasons for this shift in customer profile. B&M also said: “A combination of favourable spring weather and COVID-related restrictions led to early demand for gardening products.
“Demand remained strong through the summer months even after the lifting of restrictions, such that the sell-through of general merchandise ranges was high. End of season markdown activity was therefore limited and further contributed to a gross margin out-performance for the first half as a whole.
“These factors create an exciting opportunity for B&M to hold on to market share gains over the past two years, and take further steps to cement its position as a destination store for value for money general merchandise.”