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This article is about the bookshop chain; for the businessman and politician of that name, see William Henry Smith.
W H Smith is a British business best known for its chain of high street and railway station newsagents and bookshops. It is also a major distributor of newspapers and magazines. It formerly owned a number of other retail chains in the UK, North America and the Pacific Rim, and printing and publishing businesses.
History
W H Smith has its origins in a newsvendor business established in London in 1792 by Henry Walton Smith and his wife Anna. After their deaths the business - valued in 1812 at £1,280 - was taken over by their son William Henry Smith, and in 1846 the firm became W H Smith & Son when his son, also William Henry, became a partner. Th firm took advantage of the railway boom by opening news stands on railway stations, starting with Euston in 1848, and also made use of the railways to became the leading national distributor of newspapers. The younger W H Smith used the success of the firm as a springboard into politics, becoming an MP in 1868 and serving as a minister in several Conservative governments.
After the death of W H Smith the younger, his widow was created Vicountess Hambleden in her own right; their son inherited the business from his father and the Viscountcy from his mother. After the death of the second Viscount in 1928, the business was reconstituted as a limited company, in which his son, the third Viscount, owned all the ordinary shares. On the death of the third Viscount in 1948, the death duties were so severe that a public holding company had to be formed and shares sold to W H Smith staff and the public. A younger brother of the third Viscount remained chairman until 1972, but the Smith family's control slipped away, and the last family member left the board in 1996.
From the 1970s onward W H Smith expanded into other areas of retail. W H Smith Travel operated from 1973 to 1991, The Do It All chain of DIY stores started with a 1979 acquisition, became a joint venture with Boots in 1990 and was sold in 1996. The upmarket bookshop chain Waterstone's, founded by former W H Smith executive Tim Waterstone in 1982, was bought in 1989 and sold in 1998. In 1986 W H Smith bought the Our Price music chain; in the 1990s it also bought other music retailers including the Virgin Group's smaller (non-Megastore) shops.
Though Britain has always been W H Smith's home territory (not the UK; it was relatively late in expanding into Northern Ireland), it has also ventured into other countries at times. Canadian operations began in 1950 and continued until 1989; United States from 1985 until 2003; Australian and New Zealand subsidiaries acquired in 2001 were disposed of, as were those in Hong Kong and Singapore, in 2004. The company retains a small presence in Continental Europe.
For years W H Smith's chief rival in both the news distribution and railway station newsagent businesses was John Menzies. However in 1998 Menzies sold all its retail outlets to W H Smith in order to concentrate on the distribution business; since then nearly every large railway station in Britain has had a W H Smith branch in it.
Current activities
In recent years W H Smith has had a series of problems: its retail side has had difficulties competing with specialist book and music chains on one side and large supermarkets on the other, while the distribution side had to back down from an exclusive distribution deal with Tesco after newspaper publishers threatened to cancel their distribution contracts. There was also a significant shortfall in the group's pension fund. The result was several years of poor financial performance, and a takeover bid by the Permira group, which fell through. The group has reacted to this by disposing of its overseas subsidiaries and its publishing business Hodder Headline, in order to concentrate on reforming its troubled core businesses.
As of 2004, W H Smith has two major business areas: WHSmith Retail, divided into WHSmith High Street, UK Travel Retail and WHSmith online; and WHSmith News, the news distribution business. The retail side has 673 stores, 19,643 employees and made sales of £2,520 million. News distribution made sales of £1,067 million; it has 52 distribution centres and 4,312 employees.
In the year to 31 August, 2004 W H Smith plc had a turnover of £2,834 million, on which it made a pre-tax loss of £130 million, due to significant "exceptional items" and losses on the sales of subsidiaries. Disposals during the year reduced the group's net assets from £409 million to £256 million. At its December 2004 share price of around 323p, the company's market capitalisation was just under £600 million. It is part of the FTSE 250 Index.
Awards and prizes
W H Smith is the sponsor of the WH Smith Literary Award, which has been running since 1959 and is one of the most wide-ranging of literary prizes, admitting works of all genres from authors of all ages and both genders from across the world. W H Smith also sponsors the W H Smith Children's Book of the Year prize, which is part of the British Book Awards. In recent years it also ran the People's Choice Book Awards, though these were discontinued as the group slimmed down. The W H Smith Illustration Awards were awarded between 1987 and 1994.
W H Smith in British life
"Smith's" shops are a familiar sight on British high streets. Their book range is populist and slightly conservative; despite their former claim to be the "World's Best Booksellers", they have never sought to compete with specialist booksellers in the highbrow and academic markets or on depth in particular genres (except perhaps for railway-related books for enthusasists in their railway station branches). Similarly their audio and video departments tend to concentrate on chart pop music and blockbuster films. On the other hand, their large shops typically offer a larger range of specialist magazines than most newsagents.
For many years W H Smith's policy of not stocking the satirical magazine Private Eye, because of the company's fear of being held responsible for any libels it might contain, led to the magazine stigmatising it as "The World's Worst Booksellers" and "W H Smug". Their shops and distributors now carry the Eye.
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