B&M has rolled out more discounts in store as part of efforts to improve profits.
The bargain retailer has lowered prices on a range of key value products in store.
B&M has lowered prices on a range of products in store[/caption]
Over 35% of items in these ranges have had their prices slashed, by an average of 1.8%.
The beloved chain is also refocusing and cutting the number of ranges it has and improving availability of its most popular products on shelves.
Other measures include bringing in more flexible “managers specials” promotions for shoppers to enjoy.
The bargain chain closed 14 stores in the UK and opened up to 23 new sites.
It comes after the group said UK like-for-like sales dropped by a worse-than-expected 1.1% in its second quarter.
B&M is now forecasting half-year underlying earnings will tumble by 28% to around £198million.
This comes after the business said wage costs surged by about £30million in the first half to September 27.
It said it now expects full-year underlying earnings in the range of £510 million to £560 million – a fall of up to 18% on the previous year.
Recently appointed chief executive Tjeerd Jegen said: “Since becoming CEO in June, I have led the business through a comprehensive review of our customer proposition and operations.
“We have concluded that while B&M’s value proposition remains strong, our operational execution has been weak.
“This has impacted our first-half trading performance, and this is reflected in the full-year outlook.”
The group said it was taking “decisive actions” to boost its flagging performance but cautioned these will take up to 18 months to bear fruit.
It is not the first time B&M has shaken up how the store is run.
Back in March, B&M said it would switch up its range to include products that are more expensive.
It said it noticed that including more products that cost more on shelves had helped drive business in stores.
However, at the time, bosses assured the store would continue to sell bargain products to consumers.
Trouble for retailers
Factors such as shoppers having less money to spend at the till, and hikes to National Insurance have bruised retail business.
Late last month, high street and supermarket giants including Tesco and Boots issued a warning over price hikes ahead of tax raids expected to be announced at the next budget.
The letter, signed by Morrisons, Aldi and JD Sports, warned that further tax rises on businesses could result in the Labour Government breaking its manifesto pledge to provide “high living standards”.
Businesses have seen their labour costs rise thanks to the rate of employer national insurance being increased in last year’s Budget.
Employer National Insurance contributions (NIC) were bumped up from 13.8% to 15% and the threshold at which they are paid lowered from £9,100 to £5,000 in April.
Changes toNIC are estimated to raise between £14.6billion and £18.3billion a year.
Some retailers have blamed the tax hike for the decision to raise prices in shops, which they say has allowed them to partly mitigate the impact.
RETAIL PAIN IN 2025
The British Retail Consortium has predicted that the Treasury’s hike to employer NICs will cost the retail sector £2.3billion.
Research by the British Chambers of Commerce shows that more than half of companies plan to raise prices by early April.
A survey of more than 4,800 firms found that 55% expect prices to increase in the next three months, up from 39% in a similar poll conducted in the latter half of 2024.
Three-quarters of companies cited the cost of employing people as their primary financial pressure.
The Centre for Retail Research (CRR) has also warned that around 17,350 retail sites are expected to shut down this year.
It comes on the back of a tough 2024 when 13,000 shops closed their doors for good, already a 28% increase on the previous year.
Professor Joshua Bamfield, director of the CRR said: “The results for 2024 show that although the outcomes for store closures overall were not as poor as in either 2020 or 2022, they are still disconcerting, with worse set to come in 2025.”
Professor Bamfield has also warned of a bleak outlook for 2025, predicting that as many as 202,000 jobs could be lost in the sector.
“By increasing both the costs of running stores and the costs on each consumer’s household it is highly likely that we will see retail job losses eclipse the height of the pandemic in 2020.”
