Gear4Music [IRDX RGRM] plans to become a leading online retailer of musical instruments and music equipment around the world from its headquarters in York, where it also has a showroom and distribution centre. Today the company, a Top150 retailer in IRUK Top500 research, reported sales of £56.1m in the year to February 28, 58% up on the same time last year, and pre-tax profits of £2.6m, up from £6,000 a year earlier. Here are the key points of its plan for global growth.
International expansion and distribution
The retailer currently has responsive design websites covering 19 countries, a showroom in Sweden and distribution centres in Sweden and Germany. Over the last year it enabled distribution to a further 150 countries. “Whilst at the early stages of development, it is clear our business model is relevant to customers all around the world,” it said in its statement. In the last year international sales grew by 124%, accounting for 38% of its revenue, and Gear4Music says it will continue to build on the “early success” of its new European operations. Its German distribution centre, which started to dispatch orders in February 2017, will scale up through the year to serve central Europe. A German showroom is set to open by the autumn.
Meanwhile, its showoom presence in Sweden has led to its being appointed the Scandinavian distributor for leading music equipment brand Behringer. Gear4Music now plans to develop its proposition for the global market through the year, increasing its international presence “wherever there is an opportunity”.
Chief executive Andrew Wass said it had been “a transformational year for the business”. He said: “In particular we have seen significant expansion in our international business where sales have been very strong. We have therefore accelerated investment in our European infrastructure to improve our customer proposition and reach, most notably through the opening of two new distribution hubs in Sweden and Germany.” Over the next year, he said, Gear4Music would scale up European operations and improve its worldwide proposition.
Wass said that its website had helped the business to grow. “Our growth has been underpinned by the quality of our bespoke ecommerce platform and we continue to drive innovation in this area to further improve our systems and websites, both in the UK and overseas.” During the last year it brought its software development in-house through an acquisition in order to speed up the pace of development. That deal completed on January 1 and, says Gear4Music, “is already allowing us to achieve more, react faster to developing trends, and further scale our systems to ensure our growth is underpinned by a robust, class leading ecommerce platform.”
New features introduced online in 2017 included automatic selection of the most appropriate dispatch location, international click and collect, improvements to the shopping basket and checkout, and to the mobile website, while also moving the website to the cloud. “Our objective is continual innovation,” the retailer’s statement said, “and we have a pipeline of new features and upgrades to deploy during the next 12 months.”
The retailer has also bought a new £5.3m UK headquarters building at Holgate Park, York.
Gear4Music says the emphasis in the coming year will be on improving social media activities, particularly on mobile. It also wants to deliver a “more personalised experience” for our existing customers and website visitors”. By the end of the year, active customer numbers reached more than 339,000 while repeat customers numbers were 39% ahead on a year earlier.
Mentioned in this piece…