Duddy defends strategy for Argos
Terry Duddy, the CEO of Home Retail Group, has said the group would not close any of its struggling Argos stores and has dismissed calls from analysts to change strategy, according to reports by Reuters.
Duddy revealed that the group had undertaken extensive research following its first quarter to find out why sales at Argos stores had fallen by 9.6%.
At a media dinner last night, Duddy said the study showed that the company’s multi-channel strategy was right. He explained: “There were no eurekas. It was a full and hard check. It was a hard reflection of where we were and it tells us that we believe that actually our strategy’s right.
“And we know that that isn’t necessarily what everybody wants to hear, because at this level of performance people are expecting a sort of transformation”.
Analysts have suggested that Argos could benefit from major reduction in its 754 store portfolio, and have also called for the retailer to cut costs and
produce a smaller catalogue.
Duddy explained that it would be difficult to exit a large number of stores as many were held on 15 year leases. He added: “Hypothetically even if we did have lots of loss-making stores, we couldn’t exit them anyway.
Our view looking forward is we think we can grow our store estate further.”
Duddy said he could not predict when things would get better. “I’m not one of those people who think 2012 might be the point of optimism with Jubilee and the Olympics. All I can say at this time is it might be a bumping along the bottom and I hope that’s going to be the case.”
