* To refit entire store estate over next five years
* Refit model costs 800,000 stg, gives 20 pct sales uplift
* Sees store estate reducing from 340 to 300 stores by 2017
By James Davey
LONDON, Nov 28 Homebase, Britain's
second-biggest home improvement retailer, plans to revamp its
stores over the next five years as it battles to win share in a
crowded and contracting market.
The 340-store business, owned by Home Retail Group Plc
, said on Wednesday it will use a re-fitted store in
Ruislip, west London, as the blueprint for future development.
That store has undergone an 800,000 pounds ($1.3 million)
refit that is expected to deliver a 20 percent sales uplift over
a full year.
Speaking on a media visit to the Ruislip store, Homebase
Managing Director Paul Loft said a combination of store
investment, a focus on multi-channel - connecting with customers
through different channels including online - along with
improved customer service would differentiate the chain more
clearly from the competition.
The value of Britain's home improvement market has declined
by between 2 and 3 percent in 2012 and it is becoming
increasingly crowded, with Homebase competing against the DIY
"sheds" of B&Q and Wickes as well as Ikea,
John Lewis and supermarkets like Tesco Plc and
Asda (part of Wal-Mart Stores inc ).
Homebase ranks behind Kingfisher Plc's B&Q chain in
the UK market.
With the UK facing a "triple-dip" recession, stores groups,
particularly those focused on "big ticket" items like kitchens
and bathrooms, are finding the going tough as disposable incomes
are eroded by rising prices, subdued wage growth and government
A continuing low level of housing transactions is also bad
news for firms like Homebase, which last month posted an 18
percent fall in first-half profit.
"There's no sign of it (the economy) jumping back up in the
near term. We've got to get on with it and invest and gain share
within the market place," said Loft.
Home Retail, which also owns the Argos household goods
business, is planning capital expenditure at group level of
about 175 million pounds a year over the next three years. Of
this, about 100 million will be invested in Argos.
The Ruislip store showcases Homebase's latest proposition
and includes Laura Ashley and Habitat concessions.
Homebase has freed up space by removing slow-selling lines,
replacing them with the concessions and other brands such as
Qualcast lawnmowers, Farrow & Ball paint and a range from
celebrity chef Jamie Oliver.
There is also an increased focus on decorative ranges and
new lines such as carpets, made to measure curtains and blinds.
By 2017, Loft anticipates the size of the Homebase estate
will shrink to about 300 stores as leases expire.
Shares in Home Retail, up 43 percent over the last six
months, closed up 2 percent at 112.5 pence, valuing the business
at about 1.01 billion pounds.