Poundland is accelerating its move into the grocery market with the acquisition of Fultons Foods, the frozen food retailer that operates over 100 stores in the north of England.
The value retailer had already been working with Fultons for the last year on developing and rolling out a new chilled and frozen food range into Poundland stores. The extensive offer is already available in 70 of its outlets with the acquisition expected to enable Poundland to extend it to another 40-plus stores by December.
Poundland also plans to invest over £25m during the next two years in its chilled and frozen operation. This will see it convert suitable Fultons stores into the Poundland format, retaining a frozen and chilled offer in each location.
The retailer also plans to use Fultons’ Barnsley base as its National Frozen Distribution Centre and build infrastructure at its Harlow DC to bring its frozen and chilled food offer to stores across the south of England.
Poundland wants to roll-out the food offer to further 150 stores in its 2021/22 financial year and to as many as 500 stores over the next two years, making it an “increasingly significant player” in the near-£20bn chilled and frozen food market.
The current co-owners of Fultons will remain involved in the business. Karen Rees will become Managing Director reporting directly to Poundland’s MD Barry Williams. Chairman Kevin Gunter will continue in an advisory role for six months. All 800-plus Fultons staff will transfer to Poundland.
The move comes amid Poundland’s ongoing ‘Project Diamond’ transformation programme, which includes refurbishing stores, new openings, entering into new categories, and accelerating the roll-out of its food offer. In recent months, Poundland has started selling alcoholic drinks and a new homeware range under its PEP&CO brand, whilst adding a ‘free-from’ range to its food offering.
Williams said: “We couldn’t have developed our chilled and frozen ranges without Fultons’ expertise and now is the right time to move to the next level and bring the team on board.
“By combining our experience, we can accelerate our frozen and chilled rollout and bring the amazing value it offers to more of our customers across the UK.”
Rees added: “For the last 12 months we’ve been proud to partner with Poundland, but even prouder that today we become family. We already know the Poundland customer loves our frozen and chilled foods offer – and we’re excited to know our people will be able to play a bigger part in Poundland’s transformation story”.
Pepco Group, the owner of Poundland, stated that the transaction demonstrated its intent to invest in widening the customer offer at the retailer’s 800-plus stores. Financial details of the deal were not disclosed.
