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Eyeing growth: WH Smith won’t abandon Britain, insists Carl Cowling
It’s a busy morning at Birmingham Airport and families with their wheeled suitcases crowd the aisles.
WH Smith. Managing director Carl Cowling moves deftly between them, showing me the season’s bestsellers.
The most popular read this summer has been Yellowface by RF Kuang, a satirical thriller about the publishing industry. A biography about Taylor Swift has also flown off the shelves.
But Cowling also tells me of the importance to the group of its travel business, which includes WH Smith outlets in airports, train stations and, interestingly, hospitals. The division, he says, is “growing at a dizzying rate”. Its sales now account for almost 75 per cent of the total.
As Cowling explains, WH Smith’s mission is now to be a “one-stop shop” for the traveller.
For Brits of a certain age, WH Smith is synonymous with pencil cases, compasses and protractors when the kids went back to school after the summer holidays.
But the group also has technology-focused stores under its inMotion brand, as well as independent bookstores. From its origins as a humble book and stationery store, the company has its sights set on world domination and an empire that stretches to Las Vegas.
Cowling, 50, is pursuing his goal with the help of extensive market research into people’s tastes in reading, snacks and souvenirs.
The Birmingham Airport branch is offering T-shirts with the Brummie slogan ‘alright bab’.
In addition to sandwiches, snacks include more adventurous options such as kefir yogurt and poke bowls.
For those who forget to pack, there are expensive hair straighteners, as well as Cowling’s travel essential: “a good pair of headphones.” In Las Vegas, you can buy sequined dresses and jackets for a night out.
The company now has around 100 stores in the fun-and-play city, following its purchase of US travel firm Marshall Retail for around £325m in 2019.
Many British brands have tried to make it to the US and failed, but Cowling believes this focus on airport outlets is key to success.
The US isn’t the only country in the world where you can pop into a WH Smith branch to get your travel essentials. There are currently 762 branches in airports around the world.
And unlike the UK’s distinctive blue and white branded stores, casino and hotel stores are designed for their particular locations, blending in with their surroundings.
Airports and Las Vegas are a far cry from the company’s early days. Henry Walton Smith and his wife Anna opened their first newsstands in Mayfair, central London, in 1792.
The company expanded along with the railways, offering passengers reading material for their journey. The shops later extended to the High Street.
But why is the company called WH Smith and not HW Smith after its founder?
Henry’s son, William Henry Smith, eventually took over from his father and gave the business its name.
Cowling is committed to that legacy. There are no plans to open any further UK High Street stores beyond the existing 520, but he stresses that this is “still a great business, a profitable business” and one that he continues to invest in.
One of its latest initiatives is to launch concessions in 76 Toys R Us stores before Christmas, with even more planned.
Like other retailers, WH Smith has had to invest heavily in safety measures for store staff, who are among the millions of people subject to increasing abuse and threats.
“A more serious approach is needed to address this situation. It is an unfortunate situation where people can feel vulnerable when they go to work. I think the situation is only getting worse,” he said.
According to Cowling, there will be at least one “very serious” case of physical abuse in its stores every week. The company has installed buttons that can immediately start recording an interaction with an abusive customer and send it to a support centre, which can alert the police if necessary. But Cowling is hopeful that the new Home Secretary, Yvette Cooper, will give the issue more importance.
Earlier this month, WH Smith updated investors on its financial year to 31 August.
Group sales rose 7 percent from last year, boosted by a 10 percent increase in its travel business.
Cowling says his philosophy is to keep things simple. “I think companies and leaders make a mistake when they disconnect too much and try to overcomplicate things,” he says.
It is a long-standing retailer, having started out with Comet stores, the electrical goods chain that collapsed in 2012.
He then went on to work for electrical group Dixons for over a decade, rising to become managing director of its airport retail division.
Many of these stores were acquired by WH Smith in April 2021 after the Covid pandemic devastated the industry.
Although WH Smith has turned to travel hubs, Cowling says he is not losing sleep over the thought of a pandemic bringing the sector back to its knees.
“I find it hard to imagine that we’ll ever have that many restrictions on our lives again,” she says. “I mean, never say never.”
Ahead of what Chancellor of the Exchequer Rachel Reeves has warned will be a “painful” budget, Cowling is optimistic about the prospect of running a business in Britain.
“People sometimes feel a bit miserable, but I think we have a great environment,” he says. “Compared to other places in the world, we have a strong economy.”
His positive tone is backed by industry data.
The International Air Transport Association expects global passenger numbers to exceed pre-Covid levels for the first time this year. As we look around the shop, a customer takes the opportunity to ask if the price of the meal deal could be reduced by 50p. That’s £5.50 for the standard deal and £8 for a fancier one.
Cowling welcomes the feedback, but aren’t the prices (for example, £1.59 for a small chocolate bar) a little hard to swallow?
“It’s a very high-cost environment,” Cowling says later. “An airport is busier than any shopping centre, so rents are much higher. We open a store at 3am and close at 11pm.”
Airports also have all kinds of red tape – everything that arrives has to be unloaded and scanned by security staff before it can be put on the shelves. This explains the higher prices, he says. “What we try to do is make sure that customers feel they are getting decent value by making sure we have good deals,” he says.
He is also optimistic about the London stock market, despite well-rehearsed pessimism about foreign takeovers and the exodus of companies to the New York Stock Exchange.
With shares closing near a one-year high on Friday, the company is valued at £1.87 billion.
“American funds have been investing less and less money in British companies,” he says.
“There hasn’t been the same desire to invest in the UK stock market. I think there’s been a bit of fear after Brexit.
“But we’re still a strong economy, right? These things always happen in cycles.”
The company will “definitely” remain on the London market, he says: “We are WH Smith, we are going to remain on the UK Stock Exchange.”
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