Oddbins' new owners have begun their ambitious
to turn around the business by closing
20 stores and reviewing its entire range.
Joint owners Simon Baile and Henry Young are confident the books will balance within the year despite reporting an annual loss
of £10 million last week .
Baile and Young are rumoured to have paid Castel £5 million for the chain in August. It's also believed that
£6 million is outstanding and this is to be paid by
insta lments of around £200,000 a month
over two years.
Since taking the reins, the
joint owners have moved to reduce costs by shedding
underperforming stores. The chain now has 131 sites.
Baile said: "We
have the right number of stores to take us forward and
balance the books . A chunk of stores that were dragging us down have gone and we are only keeping half the warehouse space. The results for 2007 are the best the company has had for two years."
said that a £4 million restructuring plan undertaken by Castel last year would
speed up the turnaround process. "Anyone can kick Castel, but hats off to them for trying. All the restructuring they have done has given us a big push to break even - and possibly make a profit. After that, it's up to us to be good retailers."
he made in August to focus on unusual wines,
Baile has overhauled the chain's "neglected" French wines
and axed one- third of the 150 lines it inherited from Castel.
A review of its wine portfolio will begin this month to create a core range that will be common to all stores and complement the small parcels
Oddbins' buying team has been charged
The retailer's current 20% off deal on 12 bottles will be extended across the
chain, while a selection of multibuy mechanics will also be introduced. Baile said: "Three-for-£10, £15 or £20 are important in the current market.
We want to simplify the types of offers we have."
Baile emphasised that price would not be the sole focus of
negotiations with suppliers. "It has to be about the wine first and the deal after."
In response to
suggestions that some suppliers were cautious about trading
with Oddbins until
a strategy was
said: "I understand that the past [ figures] look horrible. But once suppliers understand what our plans are, conversations end up being different."