Comment: we need the survival of stalwarts like Wilko
Popping into my local Wilko store in North London recently for some essential items I was disappointed to find that it appeared the range of rabbit treats I frequently purchase were no longer being stocked.
This coincided with me reading the worrying news of the difficulties faced by the company, which has been sufficiently acute as to place its very future in doubt. At times like these you come to realise the value of these general merchandise stores that have found it increasingly tough to operate on the high street in recent years.
Wilko has very much been a mainstay of my family’s shopping for a specific range of items that I sometimes find difficult to find elsewhere – and at very competitive prices. Along with rabbit treats we are talking random things like light bulbs, pick & mix, bird food, and various stationery items. And that’s only the regular things. There are also many more irregular purchases like picture frames, super glue and fuses for plugs.
Like Woolworths before it, Wilko has stacks of heritage having been founded way back in 1930 when it was known as Wilkinson. In my opinion every high street should have such a household goods store but this did not help Woolies and it has certainly not insulated Wilko because even as the effective last-man-standing in this category it is still facing the great pressures that have been heaped upon all consumer-facing businesses in the post-pandemic inflationary environment.
The business made a £36.8 million loss in 2021/2 and closed a small number of units as it suffered from the decline in footfall being experienced on many high streets. To ease the situation the range has been rationalised in order for the group to be more competitive in specific key categories. These have been identified as household, garden and pet, which suggests my out-of-stock rabbit treats will hopefully have been a one-off.
This mounting pressure on Wilko has resulted in it last month hiring property agent CBRE to assist it with crunch negotiations with its landlords that centre on it seeking to reach agreement on a significant reduction in the rental levels across its store estate.
This is clearly serious stuff but the good news is that Wilko management has stated it is unlikely to permanently close many of its current estate of around 400 stores as part of a company voluntary arrangement (CVA) which is currently being explored but has not yet been finalised.
Another positive sign has been its move to create a more omni-channel business that has included the roll-out of click & collect across all its stores. Although it first opened an online store in 2005 it has been a bit of a slow-burn but things have been accelerated recently. This week’s announcement of the extension of the contract with fulfilment company GXO to handle Wilko’s digital orders until June 2026 has certainly been welcomed.
The company has also just signed a deal with Clearpay to add a BNPL option to its online checkout that will hopefully further juice its digital sales that are reported to have been up by a healthy 50% year-on-year during the last eight weeks.
There have also been positive words in recent weeks from Mark Jackson, CEO of Wilko, who stated: “We’re confident with the right actions, we’ll continue to be a key feature on the British high street and expand our omni-channel offer, providing customers a place to shop all their household and garden needs.”
I’m certainly hoping that this proves to be the case and we don’t lose yet another long-standing anchor store on our high streets. As for my children’s rabbits they are absolutely counting on its survival and hopeful long-term prosperity.
