Shoppers don’t like WHSmith - but investors might not mind

29 May 2018
Image

Shoppers have panned WHSmith for poor customer service, value and standards of its stores in a new survey, which canvasses opinions from more than 10,000 people.

The annual research conducted by consumer group Which? placed the long-standing high street shop squarely at the bottom of the pile of 100 major retailers.

WHSmith has been in the bottom two of the survey for the past eight years in a row.

One customer told Which?: “I find WHSmith very expensive and its stores need updating,” while another said: “I always use the self-service tills because the staff are rude.”

The most popular stores in the survey were retailers Lush, Savers, and Smyths Toys - none of which made the top 10 in 2017. Which? says that this year’s survey saw price become a deciding factor for consumers which gives credence to the rise in the rankings of retailers such as Savers.

Ben Clissitt, Which? magazine editor, comments: “It is clear that our traditional high street is changing and while this is bad news for some retailers who have struggled to adapt, others have seized the opportunity to make their mark.”

Responding to the Which? survey a WHSmith spokesperson says: “Only 184 people commented on WHSmith as part of this survey. We serve 12 million customers each week, and despite a challenging retail environment we continue to open new shops, and to maintain our presence on the UK high street.” 

WHSmith’s resilient share price

From an investment perspective, as a member of the FTSE 250, WHSmith’s shares are likely to form a part of many investors’ portfolios.

However, despite short term losses that can be attributed to stock market fluctuations, WHSmith’s share price has held up remarkably well. It would appear that consumer experience is somewhat detached from the value of the company, which has seen its share price rise phenomenally in the last five years.

Analysts attribute this to the retailer’s entrenched position as an airport and train station mainstay, and a successful model of selling high-margin products. The company recently came under fire over reportedly marking-up the price of toothpaste in some on-site hospital shops.

Lee Wild, head of equity strategy at Interactive Investor (Moneywise’s parent company) comments: “WHSmith’s share price has been a major beneficiary of a trend at play for at least the past few years. The company is suffering from a slowdown in consumer spending, just like every other high street retailer, but its unique positioning at airports, train stations and motorway services is helping limit the damage.

“Like-for-like revenue from town stores fell 4% during the first half, but was up 3% at the travel business. Growth in passenger numbers and more new shops at transport hubs is an increasingly important and dominant string to WHSmith’s bow.”

Comments

In reply to by anonymous_stub (not verified)

W H Smith does serve a useful purpose...it makes shopping in House of Fraser stores seem almost pleasant. WHS gives a truly vile shopping experience as a matter of course.

In reply to by anonymous_stub (not verified)

As a shopper I have become much fonder of WHS recently. My local shop tries to force me to use their automated till and ignores me if I won't, so I no longer shop there. Both local towns have recently changed their stores layout so I no longer walk past the magazines. In fact I had to ask if they still sold magazines because they were so well hidden. This all saves me a lot of money and if I do want something, I can always go on line.

In reply to by anonymous_stub (not verified)

Well the WH Smiths in the two towns local to me are just as described in the Which research - tired and run down, although I would not say the staff are rude, just looking depressed like the store. I have no idea how the company can be making any money.

In reply to by anonymous_stub (not verified)

I totally agree with the comments on WH Smith . The only reason they have any growth at train stations and airports is because they have a monopoly at these locations . Yes the staff are rude and the queues to pay are sometimes just not worth the wait . A poorly managed company that needs a new owner who understands the needs of customers .

Add new comment