Kingfisher became the latest victim of China’s housing downturn when the U.K.-based home improvement retailer announced it was closing a third of its loss-making Chinese stores and would restructure the rest.
Kingfisher’s review of the badly-performing B&Q China division found that its ‘ambitious expansion in recent years had been too fast, resulting in a rump of loss making and oversized stores.’
The word rump could, of course, be interpreted in several ways. None polite.
The Independent reported B&Q China booked a loss of $77 million in the year ended January 31 from a year ago, hurt by a 24% drop in sales and margin falls due to heavy discounting.
B&Q China offers a full design and decoration service for apartments.
With the Chinese business hemorrhaging, Kingfisher plans to close 22 of its 63 B and Q stores in China.
The remaining stores will be restructured, 17 of which will also be downsized.
In addition, it will reduce supplier numbers, product ranges and stock levels, while adding new own-brand products and services in a bid to return the division to profitability by 2011.