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ScS plans further investment in digital following strong online sales growth

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ScS has reported ecommerce sales growth of more than a fifth in its latest financial year – though 95% of its sales still take place in stores

The furniture and flooring retailer, ranked Top500 in IRUK Top500 research, said that ecommerce sales of £16.8m were 21.7% ahead in the year to July 27 compared to the previous year. At the same time, revenues of £317.4m were 1.5% up on £312.8m last time – with like-for-like orders up by 4.2% over the year. Pre-tax profits of £14.3m were 4.4% up from £13.7m last time. 

Online strategy

Online sales growth of £3m, or 21.7%, came as the retailer invested in improving the customer experience across channels.

“Despite the ’big ticket’ nature of our product offering, which means our customers have tended to prefer to purchase after trying our product in store, the modern consumer is more willing than ever to buy online,” said ScS chief executive David Knight in his annual review. “Our online offering ensures we give our customers the shop window they need to feel confident in the product they’re buying.”

To that end the retailer has opened a new photography and CGI studio in-house in order to improve imagery and video content, and has added new features and tools to its site since, it says, “we are aware that enhancing the visualisation of the product will improve online conversion.” The retailer has also increased its use of social media to show products in real homes and reached more than a million followers through its first major social influencer campaign. 

A new in-store sales app was released at the end of July, enabling sales staff to show customers the full range of products, colours and features while standardising the sales process. The retailer has a five star rating on Trustpilot, with more than 160,000 reviews.

It is now scoping the planned replatforming of its website with a view to making it faster, more responsive and more relevant to its customers.

Technology has also been introduced to areas of the business from measuring floors to planning routes and delivery.

In-store sales 

However, 95% of sales continue to take place in stores. In-store furniture sales, grew by £3.3m, or 1.2%, while in-store flooring sales fell by £0.5m, or 1.2%. During the year ScS closed its 27 House of Fraser concessions after deciding the partnership was no longer economically viable and closed its Reading stores. Since the end of the financial year it has opened a new store in Kirkcaldy.

During the year the retailer focused on lowering prices for “the value end of the market” and as a result average furniture orders fell by 3.5% in value to £1,527 but sales per square foot rose by 2.2% to £229, from £224 last time.

ScS is now working on a model store concept that it expects to roll out in the UK over coming months and it has further trained in-store staff on its flooring. It says it is the first national retailer to sell a new carpet made form recycled marine plastic and fishing nets that have been reclaimed from oceans.

But the company also said that trading conditions had become more challenging in the current financial year, with like-for-like orders down by 7.6% between July 28 and September 29. “This period,” said Knight, “was impacted by the record temperatures experienced by the UK across the August bank holiday weekend and the increasing political and economic uncertainty we are currently facing in the UK.”

Knight added: “We remain conscious of the impending Brexit deadline and the impact this may have on the market, consumer confidence and the wider economy. However, the group’s financial health has never been as strong and, with our resilient, debt-free balance sheet, we are in a good position to manage the ongoing uncertainty and furthermore seek opportunities which will add value in the longer-term. Our strong and clear value offering has proven successful and we are confident it will continue to appeal to our customers who want to buy great products at the lowest possible price.”

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