Dunelm said today that online sales for home delivery grew by 55% in its latest financial year to account for 6.1% of total revenue. So far this financial year, the company has launched a new web platform and says it will focus on growing both home delivery and the more profitable reserve and collect orders.
The update came as the homewares and furnishings specialist reported sales of £822.7m in the year to June 27, 12.7% ahead of the same time last year. Pre-tax profits of £121.4m were 4.7% ahead. The company is currently working towards an ambition of growing the scale of the business by 50% in the medium term. It said initiatives such as improved customer service, choice of products, and seasonal merchandise had helped to boost sales. Dunelm is working towards a store estate of around 200 superstores; by the end of the financial year it had 148 stores and seven are expected to open this current financial year, of which one has already done so.
The homewares company unveiled its new ecommerce platform in July and today said the customer journey and shopping experience had benefited as a result. The new platform, said Will Adderley in his chief executive’s review, “paves the way for more frequent future developments to allow ongoing enhancements to functionality – starting with increased choice of delivery options for greater customer convenience.”
It currently offers 17,000 homeware lines for home delivery, with fulfilment outsourced to a third-party specialist. “We achieve satisfactory profitability from this business in its own right,” said Adderley, “with additional benefits when customers bypass home delivery and use our Reserve & Collect service. We anticipate substantial further growth in both home delivery orders and Reserve & Collect transactions.”
Home delivery for 700 larger items of furniture is made using an as yet unprofitable two-man delivery service. Dunelm said it would find ways to make the operation profitable.
Adderley said: “It has been a busy and very successful year at Dunelm and the business is in better shape than ever with good momentum and clear plans for further growth.
“Customers continue to respond well to our specialist homewares offer and we have made strong progress in all elements of our growth strategy – achieving good like-for-like sales, opening 12 superstores and significantly increasing revenues from our home delivery offer. At the same time, we have made a number of important changes to prepare the business for its next phase of growth.”
Adderley, previously deputy chairman of the business, will return to that role once incoming chief executive John Browett, who has previously held that role at Dixons, Monsoon Accessorize and Tesco.com, takes over.
