What makes Poundland MD Barry Williams think the £1 concept can still work?

When Poundland opened its first store 35 years ago, £1 was worth £2.48 in today’s money, according to the Bank of England inflation calculator.

Pound shops thrived for years, but have slowly disappeared as inflation has squeezed the concept. Poundworld fell into administration and disappeared from high streets in 2018. One Below, which started out the same year selling everything for £1 or less, has since turned the model on its head and rebranded as One Beyond, with prices “from £1”.

‘Five Pound World’, a bizarre attempt to reinvent and futureproof the concept, opened with a handful of stores and big ambitions, also in 2018, but was gone again with months.

Another way of looking at it is that £1 today has the spending power of just 40p back in 1990, when Poundland first opened.

So, why does Barry Williams think chasing the £1 price point can still work in 2025?

Back on track

Williams returned to Poundland as MD in January, charged with getting the business back on track after a year of falling sales. For the previous two years he was MD of Pepco, Poundland’s former sister retail chain under Pepco Group, and before that, had his first stint as Poundland MD from 2017 to 2023.

Following Poundland’s sale by Pepco Group to Gordon Brothers in June, he’s overseeing a restructuring plan in which loss-making stores are closing, while also setting the discount chain on its path to recovery by rebooting the proposition in stores.

He’s not the only familiar face to return to Poundland. Its UK buying team, which was let go in 2023 when it moved to sourcing through Pepco Group, has also returned, bringing with them years of experience working within the parameters of fixed pricing.

In 2025, not everything can be sold for a quid, but 65% of Poundland’s fmcg range is currently priced at £1. That figure dropped as low as 20% when prices crept up under Pepco Group. Other price points are £2 or £3, divided by bay, bringing back some of the simplicity of Poundland’s early days for customers and the business alike.

That inflexibility is an advantage of the model rather than a weakness, Williams believes.

“It’s not a criticism [of former owner Pepco Group], but the danger is you end up with supermarket buyers who are used to how an Asda or Tesco would operate,” he says. “You’ve got to get back to those discount buyers that are looking for the opportunities that fit the business.

“The minute you release the pressure on the price points – when you put multiple price points out there, £1.25, £1.50, £1.75 – it makes it easier for everyone to say, ‘Well, it used to be a £1 but it’s now £1.25’. But that’s a 25% increase. That’s not good for our customers, so putting that pressure back on really works.”

£1 vs inflation

“When I was here first time around, we always used to say that because we hold everything at the price point of a fixed £1, anybody sat in reception with a 6% cost increase is sweating, because I can’t sell it for £1,” Williams continued.

“I can’t sell it for £1.06. You can’t take 6% off margin. So, I’m going to delist it. And then my job is to find another great value line at £1. Their job is to keep their product in our range. That’s the healthy tension we’re putting back into the business.”

The re-recruited buying team is bringing back the same discipline, and the debate over the £1 price point versus inflation is one that has not changed in years, says Williams.

“When I first joined the business, in 2016, there was a debate saying, ‘Well, you can’t hold onto the price point anymore, with inflation’. But we kept a high proportion of our range at £1 for a number of years. The last couple of years we lost the focus on that. Inflation had flown through, and new price points had been introduced.

“When I came back, I set the challenge of getting pricing back to £1,and almost instantly we’re up to 65% [of fmcg products]. We know that conversation will start again, saying ‘Can you hold onto the price point?’ Well, here I am, nine years on from when I first joined, and two-thirds of our range is £1. That’s got to tell us something. We can get there. We’ve just got to keep working on it.”

Less is more

The fmcg range has also been made much smaller, with close to 50% of it stripped out. The job of the buyers is to secure fewer SKUs, in greater volumes, that meet the criteria. And there is no shortage of them, Williams insists.

“What the buyers have got to do first is make sure they’re offering great value. If we do what some of the manufacturers do, you end up with a bar of chocolate that looks fun-size. Customers are not going to accept that.

“There is still loads of product that is around £1.20 to £1.50 in the rest of the market, that we can buy, with our volumes, and retail at £1. It works perfectly. Equally there’s a load of stuff out there that is currently £1 everywhere else that in time, with inflation, will become £1.50 in other retailers and still be a £1 line for us.”

It is the huge volumes enabled by fewer SKUs that keep the manufacturers and brands coming back for more, with manufacturers already creating specific packs for the revived £1 pricing. Seabrook Crisps, for example, has made multipacks of five bags for £1 (versus six bags at higher price points elsewhere).

“The brands are under the same pressure that my buyers are,” adds Williams. “Which brands today want to lose 800 branded distribution points on the high streets and shopping centres and retail parks around the UK? Not many can afford to do that.

“They’re fighting with the same tension that we’re fighting. As long as we’re working together, we’ll find creative solutions… That’s the way we do it.”

Of course, it is very early days, with Poundland’s restructure still subject to High Court approval next week, and the recovery plan just getting underway. But the plan – like the prices in Poundland’s rebooted aisles – could not be clearer.