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More than half of Majestic Wine sales are now multichannel

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Majestic Wine said this week that more than half of its sales in the year to April 3 were multichannel. The update came as the wine specialist, a Top100 retailer in IRUK Top500 research, reported revenues of £465m, up from £402m a year ago, and a pre-tax loss of £1.5m, down from profits of £4.7m a year earlier. Before one-off charges that mostly related to the acquisition of Naked Wines, the retailer reported pre-tax profits of £12.9m, down from £15m a year earlier.

At Naked Wines, sales of £142.2m were 26.3% ahead on last year, with gross profits rising to £48.2m from £39.6m last time.

The retailer aims to turn over £500m in sales by 2019. This week chief executive Rowan Gormley said that the retailer was “past the tipping point, both financially and operationally” and through “the most risky and cost-intensive phase of our transformation plan” after capital investment of £8m.

We took a closer look at what the results told us about Majestic Wine’s multichannel strategy.

Transformation plan

Chairman Phil Wrigley said that in the two years since Majestic Wine bought online and social-media focused Naked Wines, appointing its chief executive Rowan Gormley to the same job in the enlarged business, Majestic Wine had grown into a predominantly multichannel business – 56% of full-year sales were multichannel – with fast-growing international sales (£88m, +52.7% in the full year).

He said: “This report marks the halfway point on a three-year journey and the right time for me to hand over the baton to a new chairman for the next stage in our development.” Greg Hodder is to take over the role of chairman following Wrigley’s retirement.

Chief executive Rowan Gormley said: “Operationally, we are through the most risky and cost-intensive phase of our transformation plan.”

New IT systems built in-house have created a “solid platform for multichannel strategy” and the retailer now plans to start delivering customer-facing technology.


Store refits are leading to higher sales growth, while IT improvements have reduced manual data-entry workloads at store level. The retailer is looking to give store managers more control over their own stores and the ability to share in their store’s contribution as it aims to retain staff more effectively.

Operations and logistics

A new national fulfilment centre has enabled same-day delivery, the next-day delivery of more products, and a much broader range. The £1.8m cost of moving stock between branches has now been removed, while availability has improved from 62% to 82%.

The Customer

Majestic Wine generated “record numbers of customers and sales revenues” during the year.

The retailer has created a data warehouse that it says enables more personalised mailings to smaller groups of customers. It says a review of content for customer communications has seen its welcome campaign become 15% more effective.

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