Move will accelerate the roll out of frozen and chilled foods to more Poundland stores
Acquisition key part of Poundland’s transformation programme bringing customers broader ranges and more choice
Poundland today announces it has acquired Fultons Foods (Fultons), the north of England frozen food retailer, in a move that will help accelerate its transformation programme.
The UK’s favourite discount retailer has been working closely with Fultons for 12 months developing its chilled and frozen food range and building a distribution network to serve stores.
This partnership has enabled Poundland to roll out frozen and chilled foods to more than 70 of its stores and the acquisition will now enable Poundland to significantly extend the offer to another 40-plus stores by December, beginning this month in Luton.
The transaction demonstrates the intent of Pepco Group, the owner of Poundland, to invest in widening the customer offer in Poundland while also improving its operational gearing, primarily through reducing the discount retailer’s in-store rents. Together these will build both sales and profit, as well as creating new jobs in the UK.
While the acquisition will allow Poundland to step up its frozen and chilled rollout, it will also allow it to do more than simply almost double the number of stores carrying these ranges.
Alongside extending the range to a further 40-plus stores in 2020, Poundland plans to invest in excess of £25m over the next two years in its chilled and frozen operation to:
Convert the most appropriate Fultons stores into a full Poundland format, retaining a frozen and chilled offer in each location.
Establish Fultons’ Barnsley base as its National Frozen Distribution Centre and build the infrastructure at its Harlow DC to bring its frozen and chilled food offer to stores across the south of England.
Create around 1,000 full and part time roles through the introduction of chilled and frozen in stores and the transformation of the distribution centres in Barnsley and Harlow.
Poundland expects to bring its chilled and frozen offer to a further 150 stores in the 2021/22 financial year and to as many as 500 stores over the next two years, making it an increasingly significant player in the near-£20 billion UK chilled and frozen food market.
Both Fultons co-owners will remain involved in the business. Karen Rees will become managing director reporting directly to Poundland MD Barry Williams. Kevin Gunter will continue in an advisory role for six months. All 800-plus Fultons colleagues will join the Poundland family this month with no changes to their terms and conditions.
Poundland’s transformation strategy
The acquisition follows the country’s most popular discount retailer recently unveiling a wider transformation programme to bring customers even more choice and amazing value.
These include bringing its PEP&CO fashion brand to more than 310 locations and last month rolling out its new PEP&CO Home ranges to all stores, step-changing its general merchandise offer.
These transformation plans also include changes to stores and the introduction of wider ranges in all categories at simple prices.
As part of this project, Poundland is refreshing and refurbishing stores, pressing ahead with new stores and relocations to bring Poundland to new towns such as Banbury and Bulwell and expanding in existing locations such as Telford and Tunstall.
Poundland will also complete the first phase of its chain-wide simple pricing roll-out next month, ensuring every category has extended ranges at prices above and below £1 to ensure customers can find more of what they buy week-in, week-out under one roof.
As well as investing in stores, Poundland’s transformation plan also includes the pilot of new free from ranges and beers, wines, and spirits in selected stores.
Barry Williams, Poundland managing director, said: “We couldn’t have developed our chilled and frozen ranges without Fultons’ expertise and now is the right time to move to the next level and bring the team on board.
“By combining our experience, we can accelerate our frozen and chilled rollout and bring the amazing value it offers to more of our customers across the UK.”
Fultons’ managing director Karen Rees said: “For the last 12 months we’ve been proud to partner with Poundland, but even prouder that today we become family.
“We already know the Poundland customer loves our frozen and chilled foods offer – and we’re excited to know our people will be able to play a bigger part in Poundland’s transformation story”.
Fultons’ chairman Kevin Gunter said: “After leading the business for 24 years, I’m pleased we’ve been able to agree terms with Poundland who are committed to a renewed period of growth and investment. I’m looking forward to contributing in an advisory role over the next six months".
· Over 40 existing Poundland stores will receive an Ice makeover in the coming weeks. The next phase of this programme starts in the following locations:
w/c 12 October: Luton Retail Park Northampton Riverside Milton Keynes
w/c 19 October: Kettering Weston Favell Burton Octagon
w/c 26 October: Birmingham Corporation Street Bearwood Walsall Bescott West Bromwich Queens Wigston Acton Shopping Centre
· By Christmas, Poundland expects to be offering chilled and frozen food in around 125 of its existing stores.
· Poundland expects to convert a number of Fultons stores into a Poundland format, while retaining a chilled and frozen offer.
· Over time, Poundland will look for opportunities to relocate Fultons stores into Poundland stores as it offers more customers the opportunity to do a one-stop shop with its fullest offer including FMCG, fashion, homewares and chilled and frozen food.
· Alongside today’s acquisition of Fultons, the agreement also allows Poundland to begin the second phase of Project Ice – bringing the chilled and frozen food offer to another 40-plus Poundland stores.
Since opening its first store in Burton-upon-Trent in 1990, Poundland, has built a network of over 800 stores in the UK and the Republic of Ireland, offering top brands and great quality own brand products that provide customers with amazing value every day.
Nominated by Retail Week as Value Discounter of the Year 2019, it now has around 18,000 colleagues who serve over seven million customers every week from Wick to Weymouth, Londonderry to Lowestoft and Holyhead to Hastings.
Poundland offers thousands of quality products in store with over 1,000 well-known brands in 17 shopping categories including food and drink, health and beauty, household, gardening, DIY, pet, stationery, books, DVDs and toys. It is on a journey from a single price to a simple price point retailer. While most items in its stores are at its original £1 price point, it is extending ranges above and below £1 that also offer amazing value.
Within the UK Poundland has also rolled out its fashion brand PEP&CO to around 300 of its larger stores. PEP&CO, launched in 2015 as a standalone brand, offers customers a full range of women’s, men’s and kids’ fashion and is now bringing new style to Poundland with simple low pricing on family fashion that’s hard to find on local high streets.
From August 2020, the PEP&CO brand also began to power Poundland’s new homewares ranges, which have won widespread acclaim for their style and value. PEP&CO Home brings an on-trend, contemporary, and exclusive home and décor range to Poundland alongside a major refresh of how the products are displayed and merchandised.
PEP&CO was also nominated in the 2019 Retail Week Awards as Private Label of The Year.
Now part of Pepco Group with over 2,500 stores across Europe, Poundland also trades internationally in the Republic of Ireland through its Dealz brand. Dealz has a growing store base in both Poland and Spain.
About Pepco Group
Pepco Group was established in 2015 and comprises two strong, independent value retail chains - PEPCO and Poundland, which also trades internationally under the Dealz brand - together with a global sourcing arm, PGS, which works very closely with both operating companies.
The Group operates across some of Europe’s largest economies and has 3,006 stores in 15 countries including the UK, the ROI, Spain and across the CE region, employing 38,000 people.
About Fultons Foods
Fultons trades as both Fultons Foods and Jack Fulton.
The Company (Frozen Value Ltd) was founded by Jack Fulton in 1960, Jack sold the company in 1997 to Kevin Gunter in a Management Buy In.
The Company is 100% privately owned by Kevin Gunter, Chairman & CEO and Karen Rees, Managing Director and Finance Director.
It trades trade from over 80 stores, with its heartland in Yorkshire and stores located from Hull to Lancashire and from Teesside to Nottingham. Stores range from 2,000 to 6,000 square feet.
In 2005 Fultons moved to a new purpose-built warehouse and distribution centre in Barnsley, which also houses the head office facility. The company currently has a turnover of £60 million and employs over 800 people.
 Sources: British Frozen Food Federation – UK retail frozen food market in 2018 – £6.32bn http://bfff.co.uk/wp-content/uploads/2019/03/Pages-from-Mar_Apr-2019.pdf Chilled Food Association – UK chilled prepared food market in 2018 – £13.2bn https://www.chilledfood.org/our-market/