Some 825 Poundland stores across the UK face an uncertain future as the discount retailer is understood to be preparing for sale.
The popular high street brand is at risk of carrying out widespread store closures following recent action from its parent company, Pepco.
The firm has formally appointed advisory firm Teneo to oversee the sale process with sources claiming swathes of shops could be axed as part of the proposed sale.
A Pepco spokesman confirmed: “We are actively exploring separation options, including a potential sale, for the Poundland business.
“We have started to work with advisers to support us with this process.”
The move comes amid what Pepco describes as an “increasingly challenging UK retail landscape”.
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Poundland stores at risk of closure
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Pepco’s decision to sell follows a £640million hit from the discounter in December. The company cited higher costs from the Budget and falling sales as key challenges.
Stephan Borchert, Pepco’s chief executive, said last week that several potential suitors had already shown interest in the business.
Previously, Pepco has instructed Alix Partners to carry out a strategic review of the brand, though the firm is reportedly no longer involved.
The group has warned about its financial outlook, forecasting underlying profits will fall to between €50m (£42m) and €70m (£59m), down significantly from the €153m (£128m) recorded for 2023/24.
It remains unclear how much the Poundland sale will be worth. After the news broke, shoppers took to social media to express their dismay.
One customer wrote on X: “If Poundland closes down I’ll actually cry cause it’s so convenient for me literally down the road.”
Another consumer provided a theory as to why the retailer is at risk: “Nothing is £1 anymore that’s why Poundland is closing … hate that for us.”
A third shopper commented: “Along with Poundland up for sale and supermarkets stopping hire if staff due to changes of tax what a mess the U.K. heading is heading for.”
Research conducted by PwC found that net stores closures were up slightly for the first six months of 2024, with a total of 6,945 shops belonging to multiples and chains leaving high streets, shopping centres and retail parks.
This is the equivalent to 38 shops per day which is a slight rise in closures when compared to the first six months of 2023, when 36 shops closed each day.
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High streets have been hit by a wave of store closures in the last 10 yearsPALisa Hooker, the leader of Industry for Consumer Markets at PwC UK, shared: “It’s clear that online retail is here to stay, outpacing physical stores annually.
“As more brands invest in data and really understand their customer, new space increasingly seeks to meet customer trends for convenience, ease of access and fun, creating spaces that feel exciting for consumers to step into.
“All stakeholders, including policymakers, landlords and communities, have a role to play.
“While some consumer touch points, like grabbing a last minute present or a coffee can’t be replaced online, the high street will need to continue to evolve for a tech-savvy generation with new living, working and playing habits.”