How Toolstation and Wickes shifted their business online fast as Covid-19 hit – Strategy and Innovation

How Toolstation and Wickes shifted their business online fast as Covid-19 hit – Strategy and Innovation

Online grew fast at Travis Perkins businesses Toolstation and Wickes in a first half that was dominated by the Covid-19 pandemic. Some 90% Toolstation transactions took place online for branch collection or site delivery, while Wickes’ online sales grew by 115% and its click and collect deliveries by more than 1,000%.

The shift to digital required an agile response. Toolstation branches closed and reopened at click and collect fulfilment centres, while its website was rebuilt within days in order to handle the significant increase in sales. That was followed by a replatforming of the business’ IT infrastructure. Toolstation says its multichannel capabilities also helped its European business grow quickly after lockdown, with sales up in the Netherlands and Belgium (+56% LFL) and France (+61% LFL).

 

Wickes stores became click and collect fulfilment centres before reopening to customers in late May. Online sales were strong as shoppers bought painting, decorating and gardening supplies. But do-it-for-me kitchen and bathroom showroom sales fell by about 40% as showrooms closed in April and may and then installation was on hold until June. Now business is starting to pick up strongly in this area.

 

The fast shift to digital lifted sales at Toolstation and helped to maintain them at Wickes – but profitability was down across the business.

 

Toolstation and Wickes parent company Travis Perkins today reported sales of £2.8bn in the six months to June 30. That’s 20.2% down on the same time last year. At the bottom line it reported a pre-tax loss of £113m, down from a profit of £12m a year earlier.

 

Toolstation reported revenues of £285m during the six months – up by 37% in total on the same time last year, while on a like-for-like that strips out the effect of store openings and closures, sales grew by 12.9% during the half. Adjusted operating profits of £1m were down by 92.3% on the same time last year. The business now has 409 UK shops, up from 400 at this time last year, and 74 in Europe, from 66 last time.

 

The Travis Perkins retail division, in which 235-branch Wickes is the largest business, reported revenues of £636m in the first half, down by 8.5% on the last time. Operating profits of £32m were down by 38.5% on £52m last time.

 

Travis Perkins chief executive Nick Roberts said: “Customer interactions have changed significantly resulting in changes to the way we do business, from increased activity through digital channels through to alterations to our physical store formats in order to maintain safe working practices.

 

“Although our financial performance in the first half of 2020 was impacted by the Covid-19 pandemic, and we have had to undertake a restructuring programme in light of the challenging outlook for the Group’s end markets, we have made significant strategic and operational progress against the four strategic priorities we outlined at our full year results in March 2020.”

 

Wickes and Toolstation are both Leading retailers in RXUK Top500 research.

 

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