Argos is to open 200 new digitally enabled stores, which swap paper slips and stubby pencils for tablet computers and digital screens, as it tries to modernise and attract more upmarket shoppers.
The retailer will open 80 new outlets in Homebase, the DIY chain which is also owned by Argos’s parent company, Home Retail Group (HRG), and a further 10 in Sainsbury’s stores.
The Argos openings come after Homebase shut about 30 stores last year. HRG plans to close another 35 this year as it reduces its estate by a quarter in the face of a shrinking DIY market.
Argos was also once expected to have to close stores in the face of a dramatic shift to shopping online. But it will have increased its outlets to 800 by next year. The chief executive of HRG, John Walden, said he was considering opening even more in future.
Sales at established Argos stores slid 5% in the eight weeks to 28 February after a difficult Christmas. But an overall rise in sales at the chain for the year to 28 February lifted group sales by 1% to £5.7bn. Pre-tax profits rose by nearly 15% to £129.5m. The company lifted its full year dividend by 15% which Walden said was a mark of “confidence in the underlying performance of the business”.
Walden said he hoped that consumer confidence would pick up in the second half of the year. “The key indicators are pointing to starting to see benefits coming through,” he said.
The CBI’s survey of the retail sector, published on Wednesday, said DIY retailers had benefited from the advent of spring. The arrival of sunny weather lifted sales at clothing, furniture and carpet retailers in April, offsetting falling grocery sales.
It said the overall picture was one of weak growth, although shops reported that May was likely to be a better month.
