Al’s Well that ends well?

Much has been said about the high street demise of one of the UK’s most iconic stores, but what does the future look like for Woolworths’ successors? Craig Phillipson, managing director of retail consultancy, Shopworks, examines whether the Alworths and Wellworths can succeed where Woolies failed.

Craig Phillipson
Craig Phillipson

There’s no doubt Alworths and Wellworths are a welcome addition to the high street. Since the advent of out of town retail parks and supermarkets, stores such as Woolworths have been the lifeblood of market towns and high streets across the country. The loss of Woolworths left a gaping hole, both literally and metaphorically.

The publicity resulting from Woolworths’ disappearance and the emergence of its successors, reminds people to “shop local”. Alworths and Wellworths, together with the large number of discount stores filling Woolies’ shoes, are reinvigorating the high street, drawing shoppers to the area to the benefit of surrounding retailers. Wellworths has even launched its own range of souvenir mugs to cater for the large number of tourists visiting its Dorchester store. People want these stores to survive, but the issue is whether they can prosper after the initial interest has died down.

Looking at why Woolworths failed, I don’t believe the problem was necessarily in the offer. Some argue that Woolworths went under because it failed to move with the times and lacked relevance for modern consumers. It’s no secret, however, that the company was in dire financial straits, affected by very high rents and a serious cash flow problem, and all at a time when the worldwide credit squeeze was truly taking effect. In such circumstances, competing effectively against supermarkets and discount stores offering value ranges in Woolworths’ key areas (homeware, children’s clothes, toys, entertainment and confectionery) would have challenged even the biggest and strongest retailer. Woolworths’ sales fell.

As smaller and leaner businesses operating with lower overheads and at lower margins, Woolworths’ successors are in a better position to compete. That’s not to say that smaller retailers can survive where larger retailers can’t. The key to the success of any retail business is to remain responsive to customers, something that multi-national retailer, Tesco, does very well. But smaller concerns are ideally placed to manage their shops individually and on a local basis, enabling them to react more quickly to local need and local competition. For example, Wellworths has now introduced pet and craft sections and is supporting the ‘shop local’ concept by stocking a selection of products made by local companies; while Alworths has established a programme to gain feedback from its customers, in order to tailor its offering to shopper requirements in specific stores.

Shoppers value the personal touch offered by local retailers, and are keen to offer their loyalty in exchange for relevant products and a positive in-store experience that makes shopping quick, easy and perhaps even pleasurable. If Alworths and Wellworths can meet this need, and continue to respond as needs change, they could be looking at a rosy future. You’ve only to look at the success of designer Cath Kidston to see how it can work. The astute business woman saw a gap in the market for a range of homeware with a retro feel, made it an enjoyable experience to go shopping in her stores…and last year secured profits of £4.6m.

With news that Woolworths may well re-emerge on our high streets, like a phoenix from the ashes, Alworths and Wellworths could find themselves under further scrutiny. They must use the opportunity to capitalise on the attention and establish themselves in the public mind as responsive retailers that truly serve their local communities.

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