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Retailer bucks trend in drive for growth
RENT-to-buy retailer BrightHouse is planning to double the size of its store network in Yorkshire and create 170 new jobs in the region as it bucks the gloom on the high street.
BrightHouse plans to open 19 new stores across Yorkshire over the next three to five years.
The group is targeting market towns rather than city centres and has pinpointed Pontefract, Selby, York, Morley, Goole, Rothwell, Skipton, Mexborough, Conisbrough and Brighouse among others.
BrightHouse, which sells brands such as Samsung, Sony, Philips, Whirlpool and Vodafone, said it is targeting Yorkshire as its existing stores in the region are trading well.
At a time when people can't afford to buy a new flat screen TV, laptop or MP3 player outright, rent-to-buy is an increasingly attractive option.
BrightHouse chief executive Leo McKee said Yorkshire has proved a good selling area for the group.
"Yorkshire people have taken well to our offer," he said. "They're like the Scots – they know a good deal when they see one."
He added that the group's consumers – who typically can't get credit from mainstream lenders or retailers – are likely to prove more resilient during the recession than others.
"A significant number of our customers don't have mortgages or access to cars and many are dependent on benefits. They are less affected by the down- turn."
Asked if he would look at buying sites from Woolworths, MFI and The Pier, which have all gone into administration over the past few weeks, Mr McKee said the key feature is that stores are the right size and in the right place, ie, with a high level of pedestrian footfall.
"Typically we look at where the bus station is and where people come into the town centre," he said. "We're not looking at the heart of big cities like Leeds, we prefer market towns or the suburbs."
BrightHouse already has 17 stores in Yorkshire including Barnsley, Doncaster, Hull, Rotherham, Sheffield, Bradford, Castleford, Keighley, Huddersfield and Halifax.
Customers' average spend is 24 a week and they come into their local store to pay it off each week.
"They have a cup of tea and a chat so we are aware of any changes in their situation such as redundancy several weeks before it happens," said Mr McKee.
He added that the most important recruitment tool for the company is word of mouth.
"We are trading in local communities," he said. "The average customer lives within three miles of the store and walks past the store twice a week. We are very much a community retailer."
Last month the group reported a 15.6 per cent increase in operating profits to 9.6m in the six months to September 30.
Like-for-like sales rocketed 13.6 per cent, which is way above the levels reported by other retail- ers.
One of the country's best performing stores in the current climate is Bradford-based Morrisons which reported an 8.1 per cent increase in three-month sales last week.
BrightHouse's bad debts as a percentage of revenues were reduced to 6 per cent in the half year, down from 6.2 per cent at the same point last year.
BrightHouse opened 20 new stores over the half year to bring its total to 178 stores in total and said it had a "solid balance sheet" to fund its future growth plans.
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Friday 25 May 2012
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