Newspaper article The Journal (Newcastle, England)

Halfords Gets on Its Bike to Win Back Customers

Newspaper article The Journal (Newcastle, England)

Halfords Gets on Its Bike to Win Back Customers

Article excerpt

Byline: Iain Laing

BICYCLES to car repair firm Halfords and wholesaler Booker provide the focus for the City this week, while purchasing managers' surveys will provide an insight into the health of the UK economy.

The mild spring weather and record petrol prices will mean fewer people use or maintain their cars and spell more sales woe for Halfords when it updates the market on Thursday.

However, the chain, which operates 467 stores, is set to benefit from more strong bike sales after the recent success of British cycling that has seen Mark Cavendish crowned world champion.

The chain's shares have fallen by about 40% over the past couple of years as weak trading and availability problems triggered a profits warning. Like Tesco, the chain cut staff numbers too far and it is likely to try to improve customer service to balance out falling sales.

However, cycle sales, which are already buoyant after range revamps, have the potential to be further boosted by the Olympics if Team GB realises its medal-winning potential.

The UK's biggest cash-and-carry wholesaler is set to reveal another strong performance on Thursday as its convenience store customers benefit as people increasingly top-up at nearby shops.

Booker, which has 172 branches and supplies nearly half a million businesses including corner shops, pubs and restaurants, reported a 7% rise in sales in the 16 weeks to December 30 when it last updated the market, outperforming most of the supermarkets.

The firm is expected to report more strong trading as its independent retailer customers continue to benefit as high petrol prices force people to drive less regularly to supermarkets and top-up more at local shops. Booker, which also supplies customers including Marks & Spencer, HMV, WHSmith's shops in transport hubs and Odeon cinemas, has seen its share price quadruple in the past three years after chief executive Charles Wilson turned the business around. …

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