Waterstones to open shops in 'double figures' in 2017

Waterstones will aim to open at least 10 new shops in 2017, its m.d James Daunt has told The Bookseller, after the chain made its first profit in five years.

Boosted by “better standards of bookselling”, the 270-store chain reported a profit for the first time since 2011 under the ownership of Russian businessman Alexander Mamut and direction of its m.d. James Daunt this week.

Sales rose by 4% to £409.1m in the year to 30th April 2016, helping it achieve a pre-tax profit of £9.9m, after finance costs, compared to a pre-tax loss of £4.5m a year earlier.

In this set of accounts the company’s number of shops stood at 275 in the UK, Ireland and Europe. Since 2011, the company has closed unprofitable stores, outlets where there are two in the same location and where the landlord has wanted to redevelop the property. It has also opened stores –seven in the year to 20th April 2016 – but it closed six –resulting in a net gain of just one.

Going forward, Waterstones plans to open shops “in the double figures” in 2017, Daunt said, partly to make up for the fact that the outlets it has closed have tended to be larger than the ones it has opened.

“We are scurrying around, looking for the right opportunities, but the property market remains quite tight (in the UK),” Daunt said. “We have seen a few opportunities coming up – one in Crouch End (London), and another couple which haven’t quite come together yet. We should be able to accelerate the pace of openings this year after we have closed a couple of big ones. We are also hoping to refurbish some larger stores such as Leeds, which is a 20,000 sq ft shop. We will be looking predominantly on the high street, although we have done quite well in shopping centres recently.”

In the year to April 2016, stores were boosted by £9m investment pumped into infrastructure to create better bookshop environments.

“This investment, combined with better standards of bookselling within the shops to improve service and the range of books stocked, is once again making Waterstones, for those who love books, a place to visit and spend time in,” the company said.

Now the company has made a profit, the next three year plan is to “grow top line sales and generate more profit,” Daunt said. “We need to sustain the minimum wage increases and business rate impact,” he added.

However, Daunt also said he would like to invest more in staff in terms of training and pay. “Certainly we need to give booksellers a pay rise,” he said. “It is a virtuous circle, if you invest in staff, they want to stay with the company and worker harder, then the company does better. So we certainly want to be investing in them more going forward.”