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‘ONE’ Kingfisher 2015


Following the appointment of Véronique Laury as Chief Executive Officer, the leadership team commenced a review of Kingfisher’s business and strategy.

They concluded that Kingfisher’s position and prospects in the attractive European home improvement market were strong, but that the business needs to be organised very differently to deliver the full potential of ‘ONE’ Kingfisher.


Review findings

Home improvement is a great market with huge potential

Home improvement is a top customer spending priority, with 58% of Europeans doing a home improvement project last year. The market is resilient and its growth is supported by favourable 'megatrends' which are similar across all markets. For example, changing demographics as well as ongoing societal trends mean that households are needing to adapt their homes, while increasing urbanisation means more people are living in smaller homes. In addition, the rise in home technology and automation is changing the type of improvements people want to make to their homes, all of which provide us with sustainable opportunity.

We are right to focus on Europe+

The European home improvement market is an attractive sector, worth £235 billion(1) across a customer base of 320 million homes. Kingfisher currently has a 5%(1) share of this large, fragmented market, meaning there is plenty of scope for growth.

+ Consists of Europe and its bordering countries (eg. Russia, Turkey)

(1) Source: AMA builders merchants report 2014, AMA commissioned research, Mintel Europe DIY report 2014; BCG, KFI annual reports

We can achieve significant benefits from developing a more common, unique and effective offer

It is becoming increasingly clear that customer needs are already largely the same, that the markets we serve are fundamentally more similar than different, and that there are few known manufacturer brands across the sector. There is therefore an opportunity for Kingfisher to develop a unique offer that can be sold across our businesses. Kingfisher already has significant scale, with over a million customers a day. The potential of our £7.4 billion buying scale is still relatively untapped and we have a fragmented supplier base.

There is no one clear winning format or channel in our market today

Kingfisher's multi-format structure is therefore an advantage, having businesses across 'big box', 'medium box' and 'omnichannel'* formats. However, being omnichannel everywhere is a 'given'.

We can achieve significant benefits from unifying activities and standardising processes

Currently there are few shared processes within Kingfisher and the sharing of infrastructure is limited. There is also no standardised operating model, which means, for example, that our Brico Dépôt businesses in France, Spain, Romania and Portugal operate in different ways.


Going forward, we will operate within the following clear set of guiding principles:

  1. Customer needs come first
  2. Create a unique and leading offer
  3. Same products across Europe presented to customers in the same way
  4. Limited number of formats and omnichannel everywhere
  5. Low cost always
  6. One company culture

We believe that following these principles will drive higher sales from having a unique, differentiated offer at good prices for our customers whilst maintaining our gross margin rate and lowering our cost base. Combining this with continued strict capital discipline will deliver improved financial metrics for our shareholders.


First sharp decisions

We have made good early progress with the first ‘sharp’ decisions since the year end. As we have started to implement our plan we have refined the work streams initially outlined. ‘Customer & Offer’ are now combined as one and ‘Formats / Channels’ are now renamed as ‘Retail Operations’.

For a full progress update on the first 'sharp' decisions please see the interim results press release.

1. Customer & offer

Everything will be based on our deep knowledge of customer needs and customers’ shopping journeys. Of a total of 393,000(1) SKUs* sold across the company last year, only 7,000(1) were sold in at least two operating companies and around 193,000 SKUs related to non-ranged (delisted and ex-promotional) products which do not form part of existing retail planograms*. Driven by the knowledge that customer needs are more similar than different across geographies, ranged products (part of planograms of around 200,000 SKUs) can be more unified in all our markets across Europe+.

(1) Across top 5 operating companies Castorama France, Brico Dépôt France, B&Q, Screwfix UK & Poland

Unified ranges (same products everywhere presented in the same way) will cover unique, core essential and complementary categories, as defined below:

Unique: leading home improvement products and solutions where we want to be the first choice destination in customers’ minds. To develop unique products, we will need to develop deeper competence in areas such as design, engineering, materials and packaging to complement existing expertise as part of the new unified offer organisation.

Core essentials: home improvement basics and consumables (e.g. batteries, paintbrushes, light bulbs). Products that our customers see as universal.
Complementary: products which will complete our home improvement offer.

First sharp decisions:

  • Develop unique garden and bathroom businesses
  • Develop core essential offer
  • Develop plan to cut existing product tail*

Unified core essential offer update video

2. Retail operations

Our goal is to present the same products to customers across Europe in the same way under a simplified model. This will drive operational efficiencies whilst recognising that customer needs are evolving quickly so we need to adapt to this fast changing retail environment. Our existing channels will be managed under three formats: Big Box, Medium Box and Omnichannel, and each will be standardised across all of our markets.

First sharp decisions:

  • Space rationalisation:
    • Close c.15% surplus space at B&Q
    • Close our few loss making stores in Europe
  • Pilot Big Box best practice across Europe
  • Extend Screwfix trial in Germany

3. Infrastructure & processes

Unifying our processes and infrastructure will not only drive operating efficiencies but will also make us a simpler and more agile organisation.

First sharp decisions:

  • Pilot unified IT platform, then accelerate
  • Unify £1.2bn goods not for resale (GNFR) process

Unified IT platform – Ireland pilot update

4. People

To drive through these changes we have established a new leadership team. We need to move to a wider reorganisation in order to unlock the real potential of ‘ONE’ Kingfisher. Across the wider company we will have more international and diverse teams with deeper competence, experience, leadership, and passion for home improvement, operating with English as the common working language.

First sharp decision:

  • Finalise new leadership team and wider reorganisation structure

View leadership team


We are pleased with the solid early progress that we have made on the journey to ‘ONE’ Kingfisher on the first ‘sharp’ decisions that we announced in March 2015. We are continuing to work on the detail of our long term strategy and our KPIs and will update on further progress along the way.