Thresher unveils plans for major revamp of business

21 March, 2008

Three-for-two is scaled down as chain moves to reverse declining profits and streamline stores

Thresher Group is moving away from the three-for-two promotion that has been the backbone of its sales strategy for the past four years.

It has already been dropped in The Local, where a single bottle bay of "real value products" sits alongside a new 10% off promotion for customers who spend 10 or more on wine, trading director Lloyd Stephens said.

Other multibuy and single bottle offers are being trialled across the

estate

and the company is considering

case deals, which have proved extremely successful in Majestic Wine and have recently been taken up by Oddbins. If the promotion is adopted it is most likely to be in Wine Rack, where customers spend more and where more shops have car parks.

Stephens said: "Three-for-two was successful in 2005, but

we have seen like-for-like decline in a growing market, and customers say single-bottle pricing is too expensive. We will be reintroducing proper promotions."

Chief executive Yvonne Rankin added: "Customers

told us

they

valued promotional activity

and

a competitive market rate single bottle. It is

fundamental if we are going to fulfil

customer requirements

that we address the pricing strategy."

Managers across the estate cautiously welcomed the move. One

said: "I thought three-for-two was fantastic

but it is not fresh and new any more. And the supermarkets are getting in on the act."

Moving away from three-for-two is part of

Thresher Group 's strategy to reverse declining profits. Key changes include:

A new distribution agreement with Norbert Dentressangle. One manager has complained the system has suffered "teething problems" (see page 11). Threshers responded: "Last week we did have a few minor isolated problems but worked hard to quickly resolve these to ensure there was no negative or knock-on impact on our valued customers."

100 new Wine Racks and 100 new The Locals .

Underperforming shops

to shut.

The 1,600 estate will be cut to 1,500

Threshers will be repositioned to cater mainly for "top-up shops"

The Local shops will get 200 convenience SKUs alongside the drinks range

All Wine Rack stores will be revamped into the new-look True Blue format

Online sales will be launched

in Wine Rack this summer and later in Threshers

A new marketing director, Vibha Hardaker, has been appointed and the group is planning advertising

Staff will be rewarded for excellent customer service, assessed by mystery shoppers

The Local's Discount Booze campaign

will be scaled down

In Scotland

the Victoria Wine fascia will almost certainly be dropped and the rest of the group

brought into line with the estate in England and Wales. Thirty Wine Racks are to open north of the border.

For more details see page 14

Chief executive Yvonne Rankin

has dismissed a report Thresher is considering buying Oddbins as "misleading". Representatives from Thresher owner Vision Capital met Oddbins' French owner

Castel in late 2007, but there have been no developments since, she said. An Oddbins spokeswoman said: "There is nothing on the table at all."




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