Deutsche Tour Presentation. 27 January 2012

Transcription

1 Deutsche Tour Presentation UK Trade opportunity 27 January 2012

2 2008 KINGFISHER DELIVERING VALUE AGENDA 1. Driving up B&Q s profitability 2. Exploiting our UK Trade opportunity 3. Expanding our total French business 4. Rolling out in Eastern Europe 5. Turning around B&Q China 6. Growing Group Sourcing 7. Reducing working capital

3 Exploiting our UK Trade opportunity: Over 20bn accessible market opportunity Kingfisher relatively low market share Very fragmented with lots of Independents Market at change point Opportunity for significant growth

4 Cross UK trade strategy: Strategy to drive UK trade across UK No business boundaries, using best of B&Q & Screwfix Aligned trade strategy to become preferred supplier to small trades in the UK Multiple propositions to target different trade customer segments

5 Our Target Customers: Smaller Tradesman White Van Man Shops Primarily Over the Counter Driven Mainly by Convenience Close to Place of Work

6 Target Small Trade Segments c 23bn : Segment Multi-trade domestic Small Gen. Contractor Small Plumbing & Heating Contractors Domestic/light commercial Electricians i Market size (~ bn) Small facilities/maintainers Small Joiners Light commercial / domestic Landscapers Small Decorators (Domestic/Light commercial) Small Bathroom Fitters Domestic Kitchen Fitters Specialist Plasterers Estimated Market Sizes 1.9 bn

7 What will be delivered UK Trade Sales 747m 768m 828m 1.0bn

8 Exploiting Screwfix business model characteristics: Deep understanding customers through data Unique & flexible store model Leading edge multichannel capabilities & systems Leading edge logistics infrastructure & systems Consistency of execution

9 Deep understanding customers through data: Trade Universe You are what you buy

10 Unique and flexible Store Model: Stock room Front of store size size Add-ons a 10k ft 2 18k skus Large sqft, 0 skus sqft, 700 impulse skus Small counter Standard counter Multiple Counters b 5k ft 2 11k skus Standard 3 2k ft 2 3k skus Small ranged "best sellers" Showroom c 3k ft2 7k skus d c2k ft2 c4k skus Medium Small 4 5k ft 2 5k skus 5 10k ft 2 75kskus 7.5k Medium ranged Large ranged Other?

11 Leading edge multichannel capabilities & systems Single view of the customer Tailored UI s Order via Telephone (Voice) Mobile (iphone, App or SMS) On-line Store (Stocked) Store (Non- Stocked) EDI e.g., B2B Order & delivery in any channel Fulfillment options Fusion Platform Flexible & Modular Deliver to home Deliver to store Click or call and pay collect in store Pick up from store display Pick up from store stock (Warehouse) External supplier delivery to home Next day Next day Three minutes Now Three minutes 7 14 days

12 Implications for group multichannel development Screwfix capability & experience being used on delivering strategic group multichannel platform (Project Darwin) Darwin, will build a market leading e-commerce, mobile and assisted selling capability in store, using web based technology Initially a B&Q project, but being built in such a way as to be reusable by other op co s, and to be flexible to change to the evolving web based technologies

13 Leading edge logistics infrastructure & systems White Label Range Control Flexible routes to Customer

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15 126 Full TradePoint counters now trading Now trading across entire B&Q estate with Now trading across entire B&Q estate with additional 222 Order & Collect Stores

16 TRADE BRANDS TRADE PRICES TRADE ONLY Like a Builders Merchant Supply chain of Screwfix Convenience of B&Q Big Easy to get to Open 7 days / week 7am to 9pm

17 Activating c10, Customers per week Now 710,000 registered customers 45% Customers have bought in last 4 weeks 83% of customers would recommend TradePoint to a friend

18 Smaller TradePoint Trials

19 Trade Kitchen & Bathroom Trial

20 TradePoint Web Site

21 Still growing strongly 48.7% LFL Payback in under 2 years Trade impact on overall B&Q LFL estimated at c1.5%

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23 Typical trade counter

24 Trade Counter Growth now 69% of sales Y/E 215 trade counters 39 opened in 2 nd Half 2011

25 55,000 customers have shopped Still recruiting c470 plumbers a week

26 41,000 customers have shopped Still recruiting c400 electricians a week

27 Combined physical Plumbfix and Electricfix Specialist service

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30 brings together all UK trade Formats

31 New Transactional Mobile Site Over 15% of web traffic now from mobile devices Mobile orders up 19 times in Mobile orders up 19 times in last 12 months

32 Order On Line Collect in 15 3 Minutes

33 New Web Site 40% growth in traffic since launch 25% of Sales recommendation driven

34 Group Trade Brands

35 Smaller format opportunity 1 London 2 2 Urban 3 3 Suburban 4 Market town / rural 4 1

36 Less Space Less Investment Less Running Cost

37 Potential Size of Prize: Over 400 sites

38 End Q : Total Sales Growth +7.0% With strong cost control and improving gross margins Giving strong profit growth +28.5% With high returns in line with Brico and Poland

39 Sound Foundation for future growth UK Trade Sales 768m 747m 828m 1.0bn