Magazine article Management Today

Company Vitae: Poundland

Magazine article Management Today

Company Vitae: Poundland

Article excerpt

The cost-of-living friendly bargain store is rumoured to be cooking up an IPO - it's even signed Jane Asher...

- Formative years

Bargain store Poundland first hung its trademark turquoise-and-yellow shingle outside a shop in Burton-upon-Trent's Octagon Centre in December 1990. Founders Dave Dodd and Stephen Smith were inspired by the success of one-price-fits-all US chains like Dollar General (which turned over dollars 16bn in 2012) and reckon to have introduced the concept of 'price point retailing' to the UK.

Poundland certainly struck a chord with cash-strapped punters in the nation's post-industrial rustbelt. By eking out meagre budgets with cut-price deals on everything from baked beans and instant coffee to sticky tape and floor cleaner, Poundland now serves 4.5 million customers a week.

- Recent history

In 2002, Poundland became an early beneficiary of the burgeoning private equity bonanza when Advent International coughed up pounds 47.5m for 78% of the firm. But it was the aftermath of the 2008 crash that really put Poundland on the map. The demise of historic rivals left prime sites on high streets across the land up for grabs and Poundland was one of the few firms in a position to take up the leases. It is estimated to have gained pounds 60m in extra sales from the 2009 collapse of Woolworth's.

A year later, Advent sold to Warburg Pincus for a cool pounds 200m. By then, Poundland was turning over pounds 510m from 260 stores. Now it's rumoured that Warburg Pincus is itself looking for the exit, mulling over a float for early next year that could value Poundland at pounds 800m. …

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