Littlewoods is to cut prices by up to 20 per cent in its high-street and home shopping divisions in an attempt to position itself as the UK’s leading value retailer.
The announcement follows yesterday’s release of figures showing retail trading profits had plunged £24m to £81.3m for the year to the end of April. The company blamed increased price competition in the clothing market for the profit drop.
Littlewoods says the cuts will be made possible by integrating its home shopping and high-street buying departments. Own-label catalogue brands, such as Definitions and Essentials, will be introduced in high-street stores, as will the payment methods and credit facilities offered only to catalogue customers.
A Littlewoods spokeswoman says: “We are keeping a keen eye on the discounters to ensure we remain a value retailer.”
It is understood that a £5m above-the-line campaign, by ad agency HHCL, will focus on value and payment facilities. Littlewoods brand director Gillian Wilmott says: “Our unique positioning will be in our ability to make a profit offering credit to people whom the banks would not give a credit card to.”
One City analyst says: “Littlewoods knows it is time to catch up with discounters such as Matalan.”