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What's gone wrong with Woolies?

Woolworths interior in 1930s
How can Woolworths entice back the crowds of the 1930s?
Woolworths' profits are tumbling, but could they be turned around by the Mary Queen of Shops treatment?

The chain used to be a stalwart of the British high street, but recent years have seen empty Pic 'N' Mix aisles and falling sales.

Caught between pound shops on one side and ever diversifying supermarkets on the other, the latest results paint a grim picture.

It has announced underlying losses of 90m for the first half of the year and it has lost 250m of its value since separating from Kingfisher in 2001.

So what is going wrong? Retail strategist Mary Portas, better known as Mary Queen of Shops, visited the branch in London's Finchley Road to give her advice on saving the stores.

WHAT'S WRONG WITH WOOLIES

Mary Queen of Shops
There's no form of service whatsoever
Mary Portas
They don't stand for anything in the consumer's mind and I think they need to pick up a few really brilliant product categories and be famous for it.

They need to define what it is they are to a consumer so that they become top in the consumer's head: "I must go and buy x; therefore Woolworths is top of my list." I think they could specialise particularly well in homeware.

The layout is ridiculously confusing, even the lacklustre lower-end supermarkets do a better job. I want it to be signed - and to be able to look at the different departments. At the moment, I wouldn't even be able to explain to you what departments they have - it's a jumble.

In-depth buying. If you're going to buy a product: do it in-depth. They just have a bit of everything. We went in to buy a dustpan and brush - and there was nothing on the shelf but they had it in the stock room.

You didn't feel that they were showing it off in a wonderful way, say in the way that a Wal-Mart would in the US where you go in and its stacked with every type of product. If Wal-Mart are going to do a shoe polish, they will have every kind of shoe polish imaginable. In Woolworths it is just bits and bobs.
Woolworths Pic 'n' Mix Islington, London
The Woolies Pic 'n' Mix aisle has a place in many childhood memories

It was dirty. That is fundamental.

Staffing. When you ask someone in B&Q about DIY, they know. There isn't a knowledge base in Woolworths from their staff and I think service is going to become more and more important. I did get the old adage of 'If it ain't on the shelf we ain't got it' - and they did have it - so stop that for a start.

I also think that people want to go away feeling as if they have learned something and feeling confident that the shop will have the answer to a particular problem. There's none of that here, there's no form of service whatsoever.

CAN IT BE SAVED?

Woolworths has a network of 817 stores, sales worth more than 1bn and a huge amount of public recognition, but new chief executive Steve Johnson accepts that some of Portas' criticisms hit the mark.

"I don't think anyone is pretending that this business is as good as it should be," he says.

Johnson has unveiled his plan to turn the business around, with a strategy focused on strong Christmas sales and a back to basics approach.

"The last thing this business needs is lots of grand strategies," he says.

"What it needs now is some good basic retailing to fix some of the things that are clearly not right with the business."




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