Poundland outlines restructuring plan to kick-start turnaround

Poundland, which was sold last week to investor Gordon Brothers by parent Pepco, envisages store and distribution centre closures and will stop selling online.

Job losses will accompany the restructuring, which must be sanctioned by creditors through a High Court process, but the exact number of people affected has not been disclosed.

Poundland has identified 68 branches for closure, and over time expects to trade from between 650 and 700 shops compared to 800 at present – dependent in part on rent reduction agreements with landlords.

The retailer anticipates the closure of two distribution centres, at Springvale, Bilston in the West Midlands and at Darton near Barnsley in South Yorkshire.

The latter closure is because Poundland aims to stop trading through its website.

Poundland will also stop selling frozen food in the stores where it is available at the moment, and scale back chilled food offer, which will in future centre on items such as its £3 meal deal and essentials such as milk.

In clothing, Poundland will restore ranges lost when Pepco-sourced product was installed, providing “a greater depth of womenswear”. In general merchandise there will also be a restoration of lines such as key seasonal ranges.

Poundland managing director Barry Williams said: “It’s no secret that we have much work to do to get Poundland back on track. While Poundland remains a strong brand, serving 20 million-plus shoppers each year, our performance for a significant period has fallen short of our high standards and action is needed to enable the business to return to growth.

“It’s sincerely regrettable that this plan includes the closure of stores and distribution centres, but it’s necessary if we’re to achieve our goal of securing the future of thousands of jobs and hundreds of stores.

“It goes without saying that if our plans are approved, we will do all we can to support colleagues who will be directly affected by the changes.”