Poundland has introduced 50p ‘manager’s specials’ in a price war with new competitor One Below, which sells everything for £1 or less.
One Below is the new venture of the father-and-son duo who built Poundworld, both called Chris Edwards. The first One Below opened in March in Nottingham and there are now 38 across the UK, with plans for 75 by October.
One Below MD Edwards Jr, who along with his father grew Poundworld to a 280-store business before selling for £150m in 2015, devised the new concept as a way to undercut the fixed £1 price point.
Many One Belows are close to Poundlands, including one immediately next door in London’s Bexleyheath, prompting Poundland to drop prices and promote the offers heavily in the windows. They include 56 Huggies wipes, 25 extra strong refuse sacks and 500ml scented dehumidifiers, all cut from £1 to 50p.
Poundland has three permanent price points, of £1, £2 and £5, while its Pep&Co clothing ‘shops in shops’ also sell at higher price points.
The 50p price point was used in Boxing Day sales and “tactically”, a spokesman said.
“Poundland has a long tradition of welcoming competitors to town, so that’s precisely what we’ve been doing with OneBelow,” he explained.
The offers are targeted to undercut One Below’s most important lines, including 200 Johnson’s cotton buds, now 10p cheaper in Poundland.
“That’s one of our top sellers,” said Edwards Jr. “Fifty pence must be below cost price.”
He said he thought Poundland was trying to claw back sales lost to One Below. “We’re taking decent money so I don’t think you can open next door and not affect them.
“I’m not saying it doesn’t have an impact but we don’t notice it that much,” he added of Poundland’s price cuts. “Crown Point retail park in Leeds is my best store at the moment and we’re opposite them there.”
One Below’s stores are about 6,000 sq ft in size and sell more than 5,000 products across 10 departments including groceries, home, health & beauty, baby care, toys, DIY, party wares, craft and gardening. Around 60% of products are fmcg.
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