The simplicity of single-priced retailing is brilliant - both as a way of way of communicating good value and a way of simplifying a business's processes. Poundland, Poundworld and their leagues of imitators are capitalising on the Great British public's keen eye for a bargain in the wake of the economic downturn and we've seen the numbers of their stores grow and grow.
An Advertising Standards Authority (ASA) ruling today, though, highlights one of the difficulties of this model. Poundworld has seen its 'Everything £1' slogan banned and labelled 'misleading' after one shopper complained that it was selling some products for as much as £8.99.
It defended itself by pointing out that these were just odd items that become available, listed as 'manager's specials', that there 'tended to be no more than two products on offer at a time' which were more than £1, and that they made a lot of effort to clearly distinguish these items.
'Occasionally we see a one-off product that is incredible value costing over the single price point that we believe our customers would like to see on sale,' Poundworld's trading director, Chris Edwards Junior, told the Telegraph. 'These exclusive deals are incredibly popular.'
It's easy to see how the company has fallen into this predicament. Since pound shops first hit the UK in nineties, the value of the pound has been eroded by waves of inflation. £1 in 1990 would be worth almost £2 today. Although they can reduce some of their products in size (e.g. a packet of 10 sweets instead of 20), inflation means that selling some items for £1 will no longer be a possibility.
Assuming Poundworld's account is true, it's hard not to empathise. Having a few products that didn't cost a pound can't really be that much of a pain for shoppers, even if one busybody did complain. The ruling presents a dilemma for the company – either stop using their slogan or stop selling products for any more than £1. Getting rid of the 'manager's specials' would mean ditching a decent source of revenues, but at the same time, 'Almost everything £1' doesn't quite sound right.