Savvy shoppers boost Original Factory Shop

BARGAIN-hungry shoppers are lifting sales at Lancashire value retail chain Original Factory Shop, which is bucking the market trend by opening new stores.

George Foster, chief executive of the Burnley-based company, said cash-strapped consumers were lifting like-for-like sales at “healthy levels.”

OFS, which was bought by private equity house Duke Street Capital for £68.5m 11 months ago in a secondary buyout, will open its 100th store in the next month.

Its stores are located in smaller regional towns and sells end-of-line ranges. The company employs 140 people in Burnley and more than 1,000 nationwide.

Chief executive George Foster said: “We are trading well and are very pleased with trading. We have opened 25 stores in the last 18 months and expect turnover to rise from £68m to around £80m.”

Mr Foster said OFS was benefiting from the tough economic conditions on a number of levels: “Firstly we are local – in towns like Frodsham, Clitheroe and soon Middlewich – and I think people are travelling less because of the cost of fuel.

“The roads are generally quieter than they were – it’s something that has happens in a recession. As well as shopping locally, there’s evidence too that people are trading down to stores such as ourselves and Aldi.

“People are hunting for value for money in these difficult times.”

Mr Foster said despite last week’s dramatic 1.5% cut in interest rates to a 53-year low of 3%, it would take a while for consumer sentiment to pick up.

“The feel-good factor is going to be absent for some time – I think the country is going to see a lot more redundancies before and after Christmas. I think the rate cut will counter some of the bad news though.”

He said he is expecting a good Christmas, as OFS had picked-up ranges from suppliers who had seen orders reduced from other less successful retail chains.

Mr Foster branded the proposed congestion charge in Greater Manchester as “ridiculous” – claiming it would hit retailers located within the proposed charging zone.

“It will be good for us, and any other local retailers, but in general I don’t agree. I believe northern towns and cities need all the help they can get.”