More than a third of Dunelm sales are now online, a year on from the third Covid-19 lockdown and after a quarter in which Covid-19 restrictions came to an end.
The homewares retailer today reported third-quarter sales of £399m, of which 35% took place online. Sales in the 13 weeks to March 26 were also 69% higher than the same period last year year earlier – which mostly fell during a third UK lockdown in which non-essential shops were closed – and 40% higher than the same period two years earlier, all but three weeks of which were before the pandemic.
Last year, more than 92% of Dunelm sales were online during the same period, when the retailer was only able to sell online, either for delivery or collection. During the latest quarter, Dunelm’s new furniture fulfilment hub in Daventry became fully operational and is now ramping up capacity. The retailer said that it had a strong winter sale and more recently strong interest in home and garden products for the summer.
Dunelm has reported total sales of £1.2bn for the first nine months of the year of which 34% were online – 16 percentage points (pp) lower than in the previous year. Sales across channels were 25% up on the same time last year, and 37% up on the previous year. In the full year, Dunelm expects pre-tax profits to be in line with market expectations. Currently market expectations put Dunelm profits at between £195m and £215m, with a consensus forecast of £207m.
Building inventory against supply chain issues
Dunelm has been building inventory in order to avoid supply chain disruption. As of March 26 it had inventory worth £224m – up 16% from £193m a year ago and from £147m the year before that – and it says inventory will remain broadly similar to the end of this year.
Nick Wilkinson, Dunelm chief executive, says: “It has been another good quarter for Dunelm with sustained growth across all of our homewares categories, particularly as customers ready their homes and gardens for the summer.
“Performance has been strong across all channels and our new facilities for ecommerce and furniture fulfilment are now fully operational, which will enhance our multichannel proposition, whilst providing the capacity for further growth.
“Whilst the macro environment remains uncertain, with significant headwinds and increasing pressures on the consumer, our wide product range offers choice for every budget, whether replacing everyday essential items or refreshing a room in your home. The resilience of the Dunelm business model and the ability of our colleagues to adapt quickly to changing circumstances give us confidence in our plans and we remain well placed to continue to grow market share.”
Dunelm, a Leading retailer in RXUK Top500 research, sells online and via 176 shops, following one store opening – in Leeds – during the quarter.