After 18 months of planning the Dutch budget retailer HEMA — which already has 660 outlets across Europe — has opened its first two stores in the UK, with a promise of a third before the end of the summer.
Placed somewhere between Ikea and the now defunct Woolworth, Britain’s first HEMA store opened its doors last month in London’s Victoria. A second two-floor outlet followed in Kingston two weeks later. Both have been created with a transparent and logical layout in order to allow UK shoppers to get used to the HEMA “formula” as quickly as possible.
Each store in the retailer’s Europe-wide network is sectioned into living moments — such as Eat, Study, Live and Beauty — and with each stocked with products that are geared towards that particular moment. It also prides itself on displaying all its prices in round figures; £5 instead of £4.99.
“If these pilots prove successful, we might very well start opening English HEMA stores at the same rate as we did in France, almost one a month,” explained HEMA spokeswoman, Inge van Baarsen. A third store at Bromley is already being outfitted and will open by August.
Analyst Patrick O’Brien, of Verdict retail consultancy, feels HEMA might slip comfortably into the void left by Woolworth. “The group marries discount and value retailing with an Ikea design aesthetic” he said. “It’s the kind of retailer Woolworths could have been if it had been invested in properly.”
Not that HEMA hasn’t had its own problems during the recession. Chief executive officer, Ronald van Zetten, recently stated that his company was still profitable, despite its onerous position in the Dutch market. “Nevertheless, our focus is still on Dutch activities in the upcoming years, as that is where we are struggling and it remains our home market.”
Even if the Dutch shopper is turning away from budget buying, there is plenty of UK potential. “Discount general retailing has been very successful,” added O’Brien, “with the likes of Poundland, Home Bargains and the family-owned Wilkinsons all thriving.
“With more than 43,000 shops now lying empty in the UK, HEMA will have its pick of the high street sites. It is also going up against all the major grocers,” he said, “but somehow I don’t think the grocers will lose too much sleep over HEMA’s arrival.”
The first HEMA store was opened in Amsterdam’s Kalverstraat in 1926 by two entrepreneurs, Arthur Isaac and Leo Meyer, who wanted to offer struggling shoppers some cheaper alternatives. The families lost control of the company when it was sold to the retail giant Maxeda and eventually passed on, in 2007, to the private equity-backed Lion Capital investment group.
Cash-strapped shoppers in The Netherlands, France, Germany, Belgium and Luxembourg have been supporting HEMA for decades. Van Zetten senses the British public is now ready for its unique style of bargains. “Just because it is cheap,” he says, “it doesn’t need to be ugly.”
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