Where next for Kingfisher?

Few companies have embarked on as ambitious a reorganisation as Kingfisher. And now, half way through the programme, Veronique Laury, its architect, has announced that it is time to step down.

This is not a signal that the One Kingfisher programme has failed. There is no sense that it is being halted. In fact it is now roughly half way through and has acquired a momentum of its own.

One Kingfisher

The key elements of the One Kingfisher programme were:

  1. Unify the IT systems across the whole group

  2. Establish a single buying organisation, unify the ranges across similar types of business. In practice that meant three different streams – DIY superstores, trading as either B&Q or Castorama, smaller stores such as Brico Depot and trade orientated counter service and online businesses, such as Screwfix.

The systems side of the transformation is now largely completed.

The single buying organisation is established and 44% of products (on the basis of cost of goods sold) have been unified. In fact the exit rate at the end of January 2019 was 50%.

So Veronique Laury’s planned departure does not signal a sudden change in strategy. The One Kingfisher programme will continue.


But there’s no doubt that the businesses that are currently performing worst are also those which have had to go through the biggest changes – Castorama and B&Q. Castorama in France has been performing particularly badly falling by 7.1% like-for-like in 2018/19. The Gilets Jaunes demonstrations hurt, and there was disruption because of the transformational activity. However, B&Q in the UK did not suffer so much, though it may be that the problems of Homebase helped there. Castorama in Poland performed well.

Businesses less affected by the transformation programme – notably Brico Depot in France and Screwfix in the UK performed well. But Kingfisher has decided to close the Screwfix operation in Germany and had already decided to exit Brico Depot in Spain and Castorama in Russia.

Underlying trends are against DIY

DIY is a difficult sector in most countries, especially in Western Europe. An ageing population, allied to a falling the proportion of homes which are owner occupied, have led to a decline in demand from the superstores. In France, Castorama’s position has been made more difficult by the good performance of its main rival, Leroy Merlin. In Germany the superstore market leaders have held up well. But that must have been at the expense of small to medium size chains. A common story in Western Europe has been a shift away from superstores to non-specialists, reflecting a decline in the numbers who are in a position to undertake major DIY projects.


Any period of transition is difficult for a retailer and there is no reason to suppose that a replacement for Ms Laury will be found soon. But to add that uncertainty to the ongoing disruption of the transformation programme can only make matters worse. The transformation programme is taking place against a very tough market background and for all the optimistic statements from the company, it is still not clear that it will succeed. All we can do now is wait and see.

The One Kingfisher programme is about efficiency and improving profitability. It is a way of minimising the adverse impact of the current market environment. It cannot reverse the underlying adverse trends.

All these matters will be discussed in greater depth in the forthcoming European DIY retailing report, May 2019.

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