Value retailer Pep&Co is on track to serve its millionth customer in early December, five months after it opened its first store in Kettering, Northamptonshire, on July 1.
Andy Bond and Adrian Mountford, Pep&Co
Managing director Adrian Mountford said Pep&Co was trading ahead of expectations, thanks partly to its strategy of targeting secondary locations.
“Our performance shows that these secondary high street locations are not dead, which we believed all along,” he said.
“We’ve generally found that the smaller towns such as Kettering, Yardley [Birmingham], Runcorn [Cheshire] and Chelmsley Wood [Solihull], where there is less competition, are performing the best.
“I think it will be a slower burn in locations where there are lots of other clothing retailers as they get to know our brand. Our ranges will only improve with time.”
Pep&Co opened its 50th store in Dartford, Kent, on September 19. Mountford said a further rollout is a question of “when, rather than if”.
Property sources suggest the team is targeting a similar number of openings next year, although Mountford was reluctant to confirm exact figures.
Kidswear ranges have been most consistent, with babywear performing particularly strongly. There have been more highs and lows in womenswear, which Mountford said the team can learn from.
”We have learned things like our customer wants less formalwear, for example, and more casual items, while footwear has been better than we anticipated. Knitwear and outerwear has been difficult to read because it has been so mild,” he said.
Pep&Co received requests for menswear soon after its launch and created a range that is dropping in stores throughout November. It will be further expanded for spring 16.
Mountford said they have decided to phase out home decoration as a department and replace it with menswear.
“Homewares have not performed as well as we had hoped, because there is a lot of competition in our locations.
“The impulse buys worked well, such as tea lights, trinkets and seasonal items by the till points, so we will continue with those, but we think we can make at least double the amount of sales from that space with menswear.”
At the end of October, it was revealed that former Asda chief executive Andy Bond, who is chairman of Pep&Co, is launching a new discount variety chain next year.
The as-yet-unnamed chain will fall under the umbrella of Pep&Co’s parent company Pepkor UK, which is backed by South Africa-based Pepkor Group and retail billionaire Christo Wiese, but will be run as a separate business.
It will sell general merchandise and ambient grocery ranges. Approximately a third of the floor space will be given to Pep&Co clothing.
The chain, run by a separate team based in Leeds, aims to open 10 stores totalling 10,000 sq ft by the middle of this year in retail park locations, rather than the secondary high streets targeted by Pep&Co.
“The new stores will stock a full range of Pep&Co womenswear, menswear and kidswear and Andy believes there is an opportunity to top up some of the ranges due to the difference in locations,” said Mountford.