Retailers move out to the shed: Martin Geary looks at the trend toward volume selling from warehouse outlets

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The Independent Online
DIXONS' recent purchase of PC World, the computer warehouse chain, merited just a small mention in the business pages, but the move could be another blow to Britain's beleaguered high streets.

The electrical group has a big presence in the high street with its Dixons and Currys chains, and apparently has acted to protect its interests in the face of a perceived consumer shift to out-of-town shopping.

The pounds 8.5m acquisition of Vision Technology Group gives Dixons four PC World supertores around London, plus a thriving mail-order business.

The group is already looking to expand the chain in other British cities, although a spokeswoman said: 'We won't ever move off the high street - this is a different angle to our business.'

Aware of the need to spread its retail base, it has doubled the number of out-of-town Currys superstores to 128 over the past four years, and recently introduced business equipment, including computers, into a quarter of these outlets.

PC World opened its first 30,000 sq ft store 16 months ago outside Croydon, offering a wide product range and competitive prices for business and private buyers.

The retail giant Kingfisher has joined forces with the Staples chain in the US to present a tough new 'shed retailing' challenge in the pounds 8bn-a-year office supplies trade.

Its first 20,000 sq ft 'stationery shed' will open in Swansea in May, with three more Staples outlets planned by the end of 1993, selling everything from pencil sharpeners to computers.

Other British companies have also been watching the dramatic growth across the Atlantic of retail 'shed' outlets. Nurdin & Peacock is experimenting with an office supplies section at its Glasgow cash-and- carry, and may extend the idea to others among its 45 outlets.

John Whittle, managing director of Trade Media, which publishes office equipment magazines, forecasts the new generation of office stores could make just as big an impact as have the DIY sheds, 'with 200 superstores opening within 10 years, given the right economic climate'.

Other US chains will arrive here soon, he believes, because 'they see the UK as a stepping- stone into Europe'.

Some companies, however, remain confident the high street is the place to be.

Malcolm Cooke, marketing director of the 160-strong Ryman and Wilding chains, argues: 'There is still a big market with the emphasis on service and convenience. The average purchase in Ryman's, for instance, is just over pounds 5. These large operators will be looking for people to spend much more than that. The only way these superstores make a profit in the States is purely by numbers.'

He added that there was a portion of the stationery market which was 'untappable' by any shed chain. 'You won't get government contracts going out to Staples, and you won't get conglomerates using the sheds.'

(Photograph omitted)

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