Wickes is poised to slash prices in preparation for increased competition from Homebase’s new owner, Wesfarmers.
The Homebase chain was purchased from Home Retail Group in February for £340m. Under the Bunnings name, the chain will receive a burst of investment from Wesfarmers. Wickes, owned by Travis Perkins, is now preparing to face this strengthened competitor.
“I’m not against good competition as it helps drive the market forward… Competition is going to heat up but we think we have a good plan,” said Chief Executive of Travis Perkins John Carter. “If we have to adjust and invest a little bit in price we are willing to do that.”
Wickes currently accounts for a £1.1bn share of the £13bn UK DIY Market, just behind Homebase’s share of £1.5bn.
In its recent first quarter results, Travis Perkins revealed a 7.3% increase in like for like sales for its consumer division, in which Wickes is the main contributor. During the 14 weeks to 2 April sales at Wickes were driven by investment in price, an enhanced product range and improvements to customer service, though its own individual results were not published separately from the entire division.
“All of our businesses demonstrated good growth in the first quarter of 2016,” said Carter.
“The consumer division maintained the strong momentum established in 2015, with excellent like-for-like growth.
“Our three priorities remain unchanged – the modernisation of Travis Perkins, the transformation of Wicks and improving the performance of the restructured plumbing and heating division.”