20 July 2024, 15:50
By Furniture News Feb 10, 2021

Confident Dunelm plans to upscale furniture offer

Dunelm has reported sales growth of +23% across the 26 weeks to 26th December 2020, despite the impact of store closures in the retailer's Q2.

Digital sales grew by +111%, while the number of Dunelm's active customers grew by +4.4% (driven primarily by online growth).

CEO Nick Wilkinson comments: "Sales were particularly strong in the first quarter, before we had to navigate the various restrictions which impacted the remainder of the period. These restrictions have become more severe in the second half of our financial year, with all but one of our stores currently closed, although we continue to serve customers through our digital channels, which have significantly advanced during the last year. 

"Beyond the near-term uncertainty, we have never been more confident about the future. Dunelm is a market leader with a challenger brand mentality, in a large and growing segment. We have a clear runway to grow active customers and their frequency across our total retail system and to realise our long-term ambitions."

Dunelm says it continues to make good strategic progress on its 'Customer 1st' plan, and has been deepening its customer insight – the retailer now recognises that around 40% of its sales are derived from some 12% of its active customer base.

On the evolution of Dunelm's product range, Nick adds: "We will continue to raise the bar in our core product offer as affordability and sustainability become even more important - offering customers value they can believe in. We will help our customers 'live well' from home by introducing new desks and chairs, dinnerware and storage. We will build further scale into our furniture offer through the development of our sourcing capabilities, fulfilment capacity and improvements to the in-store selling experience. We will grow our presence in adjacent categories including home decorating, outdoor living and 'make and mend' crafting.

"Following some disruption to our supply chain in the first half of the year, we expect to return to higher levels of stock availability during the second half of the year, which will support a compelling re-opening offer in stores and a strong proposition online.

"Given the uncertainty as to when Covid-19-related restrictions will be lifted, we are unable to provide meaningful guidance on the outlook for the full year. However, to date in the current quarter, we have been covering approximately 70% of our prior year sales through our home delivery and Click & Collect services. At this level of sales, we are making a modest weekly loss.

"Beyond the near-term uncertainty, we have never been more confident about the future."

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