Customers, who will have to prove they are small businesses to qualify as members, will enjoy discounts of at least 10 per cent on about 2,500 lines picked from pallets in a huge warehouse-style store.
Littlewoods, which disclosed flat group profits and sharply worsening losses in its Index catalogue shops, has signed a joint venture with Price Club Canada, part of Price Co, America's second-biggest warehouse club operator.
If the first store - probably to be sited in the North-west - succeeds, the two sides will roll out the format. CostCo, a rival US group, and Nurdin & Peacock, the cash and carry firm, also have plans for British warehouse clubs.
In the US, warehouse club members typically spend dollars 1,500 a year. The annual fee is dollars 20-dollars 25. The stores are usually about 100,000 sq ft - three times the size of a typical Sainsbury superstore.
Losses at Index worsened to pounds 9.1m in 1992 from pounds 3.7m, bringing total losses since its 1987 launch to pounds 53.3m. Index, set up as a rival to Argos, has never made a profit, despite growing to a 127-store chain with annual sales of pounds 228m.
Littlewoods reported pre-tax profits of pounds 97m on sales of pounds 2.7bn. Profits in mail order were flat at pounds 56m on sales of pounds 974m. Littlewoods chain stores' contribution fell 8 per cent to pounds 28m on sales of pounds 696m. The football pools business improved from pounds 19.9m to pounds 21.6m on sales of pounds 780m.
The shareholders - the 34 members of the Moores family - intend the company to remain private, Littlewoods said.
View from City Road, page 32Reuse content