In the last eight weeks, Pepco has doubled the amount of floorspace dedicated to babywear in its stores that feature clothing.
This includes the 56 Wilko stores which Pepco purchased when the British retailer collapsed earlier this year, which have now reopened as Poundland stores.
The expanded space has allowed its Poundland and Dealz stores to showcase new Pepco ranges including licensed products featuring Harry Potter, Warner and Disney branding.
Pepco says that internal pricing surveys have shown that its new ranges offer “significantly better value” than rivals Primark, George at Asda and F&F at Tesco. It claims the move towards ranges powered by Pepco as allowed Poundland to reduce average selling prices by 10%, as it takes advance of the group’s buying power.
Prices on Pepco's licensed kids' sweatshirts start from £4.
Rival Primark recently reported a rise in annual profits, following aggressive store expansion to increase visibility in the European retail market. Associate apparel analyst at GlobalData, Alice Price said that this was needed to steal market share from local rivals, including Pepco.
Pepco says that its customers will now start to see clothing ranges in Poundland and Dealz stores changing more frequently, with new products launching each week.
Poundland’s commercial director Tim Bettley says: “As we’ve transitioned to these new ranges over the past three months, it’s been clear our customers have appreciated the lower prices and new ranges – especially in baby and kidswear.
“By taking advantage of the scale of our parent company, we’re able to double-down on the promise we make to deliver the amazing value we’re famous for.”
Pippa Stephens, senior apparel analyst at GlobalData, says that, while the expanded Disney-branded ranges are likely to be welcomed by consumers, Poundland will have to ensure that there is enough differentiation from its rivals.
Stephens says: "Poundland's expansion of its clothing ranges will be well received by consumers, with its value prices attracting those trading down as inflationary pressures hit their discretionary incomes. Its focus on babywear and childrenswear is particularly wise, since parents are usually reluctant to spend considerable amounts on these categories due to how quickly children grow out of or spoil items.
"While the introduction of licensed products from franchises like Harry Potter and Disney will also create greater appeal among young shoppers, it must ensure it creates enough differentiation from the ranges offered by competitors like Primark in order to really stand out."
The Pepco group has more than 4,600 stores across Europe, with products sourced by its PGS team. It claims that Poundland has become a “significant player” in the clothing market in the last five years, offering an alternative to supermarkets.
In September, Pepco Group’s CEO resigned, amid weaker sales performance and lower FY23 outlook.
