The Woolworths confectionery department went into the twenty-first century on top of its game. It held a dominant position in the market, as the largest in Europe. It had been dubbed "the pic'n'mix retailer", in honour of the iconic sweets and its broad range. Just seven years later the long-established chain collapsed into Administration. The stores disappeared from the High Street just forty one days later. Today Woolworths pic'n'mix is only available on-line.
In 1999, a planned merger between the parent company, Kingfisher, and Asda failed at the eleventh hour, after the supermarket chose to join Walmart. City Analysts started to ask whether the CEO, Sir Geoffrey Mulcahy, had lost his touch and had allowed the Group to become too complicated. After a bitter war of words, in 2001 Superdrug was sold privately and Woolworths was 'set free' on the London Stock Exchange as the largest of a group of companies.
The slow demerger process was painful and disruptive. It prompted many old hands to abandon ship, particularly after new talent was hired from outside to take charge. It fell to a new CEO, Trevor Bish-Jones, to set a strategy and take the business forward. His plan was radical. He recommended that the chain should concentrate its efforts on serving mums and young families. He called the formula 'Kids and Celebrations'. The ranges of Toys, Kids Clothes, Party Products and Entertainment were expanded, at the expense of Home, Kitchen and Garden. Sweets remained a key ingredient of the formula. The planners were asked to squeeze the same range into a lot less space.
As the idea took shape, the children's departments were moved towards the front of the store and the entertainment department was moved towards the back. The new CEO was keen to add a 'seasonal space' in every branch, eating into the area that had previously been dedicated to sweets and pic'n'mix. Every display had to be condensed, meaning that many best-selling lines like Cadbury's Dairy Milk which had traditionally merited a whole shelf of their own were given a single row. This made it much harder for the stores to keep the best sellers on sale, requiring them to top up from the stockroom several times a day.
The largest stores were given a full makeover. It included an attractive pic'n'mix counter. This which acted as a beacon for a compact sweet shop. Most younger shoppers seemed to like the trendy, eye-catching wall display.
The modernisation helped to minimise a fall in sweets sales from the space reduction and higher prices. But only 200 stores were updated. The 600 smaller shops changed layout with their old fixtures, and saw a sharp decline in the sale of sweets.
The new formula boosted the amount spent by loyal customers, but was less appealing to shoppers without small children. Traffic numbers declined each year from 2002-2007.
The pic'n'mix range provides a good example of some the problems at the company in the 2000s. A member of the Buying Team observed that some customers did like buying pic'n'mix in the stores as they did not know how much they were spending until they got to the scales at the checkout. They suggested that as well as selling by weight, there would be a market to sell fixed prices cups or boxes or sweets. The CEO agreed and announced that he planned to give the Pic'n'Mix department a 'TBJ Makeover'. It proved a tough challenge:
- Implementing the idea took a whole year, where 120 years earlier Frank Woolworth had launched the pic'n'mix department across his whole chain in North America from scratch in just eight weeks.
- Despite excellent sales the cups were later withdrawn, because it was felt some thrifty shoppers squeezed too many sweets into the cups, finding a way to buck the system and eat into profits
- When the cups were withdrawn, a gap was left on the counters. This prompted countless requests for cups and left many customers unhappy.
- Pic'n'mix had five different Buyers between 2002-6, with none lasting more than twelve months. Most were poached to take on similar roles with the supermarkets. In the early years of the Company such a defection would have been considered tantamount to treason.
In 2004, as work to convert the larger stores to the new look continued, the chain dabbled with a new shopfit for the smaller branches and the much larger out-of-town 'Big W' Superstores.
The small stores had already adopted the new Kids and Celebrations layout. Despite new fixtures and a loud new colour scheme, the sweets offer was the one area of the store which remained largely unchanged. The big idea behind the modernisation was the introduction of an extended range of products to order, which included only a few confectionery lines.
A trial group of 'Big W' stores were rebadged Woolworths and got a major makeover, including a new look inside and out. Intriguingly, while there were no significant changes to the offer of sweets in the store, new counters and new branding was designed for the displays of weigh-out sweets. The rationale for changing the spelling of the brand name was never explained. The amendment was dropped before a cheaper version of the modernisation was applied to the remaining stores.
With increased competition from the supermarkets and mediocre results from the investment in a new store look, the focus turned to new channels to market. The woolworths.co.uk website grew its sales from under £10m to £70m a year between 2004 and 2007. Meanwhile store pic'n'mix fixtures in the unrefurbished stores were in poor condition and there were insufficient funds to replace them.
Despite this, many were surprised at the remedial action proposed by the CEO. After a tradition spanning 120 years in which Woolworths had established a range of weigh-out sweets that was legendary around the world and synonymous with the company itself, it was agreed that the firm would outsource the buying and merchandising operation to Candy King, a British firm which had helped the supermarkets to move into Pic'n'Mix and developed an out-of-the-box fixture, product and service solution. Candy King would replace all of the fixtures (including those recently installed and illustrated above) with their own units and range, and would provide representatives to place orders and generally keep the displays in order.
It appeared that this would be more profitable than operating independently.
Whatever the rights and wrongs of the decision, and despite some flexibility which allowed Woolies to nominate some sweets to be added to the conventional Candy King selection, the overall effect was that the range was undiscriminated from the supermarkets, cinema chains and other outlets that stocked Candy King products. The Pic'n'Mix words were largely removed from the stores, replaced with Candy King bags and signs. Within three years the retail chain was out of business and the only place to buy Pic'n'Mix from Woolies was via the Internet website, revived by Shop Direct.
Once upon a time Frank Woolworth was known as the Candy King.