7 days ago
We're still on a roll - thanks to Britain's builders, says Screwfix boss
There is great excitement on a sweltering hot day on my local high street in East Sheen, South-West London, where the staff at Screwfix await a visit from Thierry Garnier, the chief executive of its owner, Kingfisher.
The bold Screwfix fascia is a newcomer to the city centres and suburbs of Britain. A supplier to the smaller tradesman, it is at the cutting edge of shopping innovation. Under Garnier's leadership, Screwfix has transformed turnaround times for local builders, enabling them to spend more time on the job.
The concept of smaller Screwfix outlets occurred 'by accident' during the pandemic, Garnier explains. He said Kingfisher had experimented with a 'very tiny' store at London's Victoria station and was 'amazed by the result'.
The French boss, who lives in Marylebone, central London ('I don't like to commute,' he says), dresses for the shop floor, not the boardroom. Slim and lithe, he wears a blue polo shirt and a blouson.
We don't tend to think of Kingfisher as a clothing retailer. But among its best sellers in the blazing summer heat are hard-wearing shorts for construction workers and durable fans on stands.
I wonder if the arrival of a Screwfix on my high street risks putting the local hardware shop out of business? The store manager argues that they do different things. When someone comes in looking for a couple of brass screws, he sends them to the DIY shop. Builders want bulk - a box of a hundred or more.
The building trade, Garnier tells me, now say 'I'll Screwfix it' when going online, like when people say 'I'll Google it'. Store assistant Steve, who shows me around a 'City' format shop with 12,000 items, demonstrates a screen that can identify a broken part, such as an electric socket or an obscure tool, and source it immediately.
The IT system then locates an exact replacement that can be clicked and collected within a minute or couriered locally within 20 minutes.
There are now 952 Screwfix stores in the UK, with 30 in city centres, and another 30 planned for this year. Aside from Screwfix, Kingfisher is best known for B&Q.
Bringing more technology and speed to Kingfisher is among the ideas learned in China that Garnier, 59, has brought to the group since taking the helm in September 2019. A Sino-enthusiast, he tries to keep up with his Chinese language skills, having spent a great deal of time in the country. As a result, he says the antipathy to Beijing in the US and the West is 'very sad'.
The company's expansion plans include rolling out more Screwfix stores and extending Tradepoint, the membership scheme for tradesmen at larger B&Q stores, by adding builders' entrances.
It is also experimenting with smaller high street and suburban B&Qs, with the collapse of rival Homebase having created a chance to snap up useful locations. Garnier buys into Britain as a nation of gardeners, with B&Q now claiming to be the biggest horticultural retailer in the UK.
Kingfisher is also focused on expanding its online operation, and is devoting a third of its spending to technology.
However, there are clouds on the horizon. Kingfisher, which also owns brands such as Castorama in France, expects to take a multi-million-pound hit from Labour's decision to raise employers' national insurance contributions. But Garnier strikes a philosophical, almost conciliatory, tone to the tax raid. 'It is an obviously difficult situation [for the Government],' he says.
Yet it will take a toll on the firm, which expects a £145 million hit to profits as a result of tax rises in the UK as well as a similar payroll and packaging tax in France.
Garnier also vents his frustration at Whitehall's failure to recognise what he says is the imbalance between online and brick-and-mortar retailers. 'If you describe yourself as an online company, you don't pay tax at all in the UK,' Garnier says. 'Even in the EU, they don't pay tax anywhere. That's unfair, because retailers must compete with them.'
That causes companies to 'invest less' and 'over time you lose competitive edge'. He adds: 'We need a level playing field with online companies, such as Amazon and Google.'
I suggest that all of this works against Chancellor Rachel Reeves's growth agenda. 'Yeah, exactly,' he retorts.
The Frenchman's biggest corporate challenge is Kingfisher's French arm, sparking speculation that it might be separated from the rest of the business or sold. But he is adamant that it is a core business and that shareholders have bought into a recovery plan. 'Discounter Brico Dépôt [in France and Spain] is doing very well. We gained market share in 2024,' Garnier says, although he admits that France is still 'tough and more difficult than the UK'.
' Inflation is lower in France than in the UK, but unemployment is higher. In France, it is all about consumer sentiment. The British consumer is very resilient, there is an energy in the UK,' he says.
By contrast, the French are more cautious. In uncertain times, they save rather than spend.
Turning Castorama around has required some changes, including talks with France's trade unions to push through job cuts. And some of its shops are being moved to franchise models.
'That's delivered so far,' he says.
In Britain, Kingfisher isn't worried about the unions. But does he fear the changes in Deputy Prime Minister Angela Rayner's Employment Rights Bill?
Garnier is sanguine, believing the company is in a 'good place' to weather the changes. But he concedes that the firm might have to adjust some part-time contracts.
As a keen sailor, Garnier is used to moving with the prevailing winds, which may explain his somewhat relaxed attitude to the storms buffeting the UK economy.
That doesn't mean he is happy with the country's direction, and is unimpressed by Labour's failure to build relationships 'through engagement, trust and stability'.
'That's what we need,' he says.
