Hotter is selling on the M&S website as it expands the number of digital partners that it sells through. From today an initial range of 32 products is available on the Brands at M&S platform – rising to 75 soon.
The partnership with M&S is part of Hotter’s digital-first strategy. Its parent company Unbound Group is also talking to a number of partners about a summer launch for its own multi-brand ecommerce platform, built around the Hotter brand.
In a trading update today, Unbound shows that the strategy appears to be paying off. Hotter revenues for the year to January 30 2022 have grown to about £51.9m, up 16% from £44.5m in the previous year. At the same time the brand saw average selling prices increase by 16%, while profit margins improved to more than 63% (+9pp) a year after average selling prices were hit during pandemic lockdowns that mostly fell during the previous financial year.
Pre-tax profits before exceptionals – including the costs of its stockmarket flotation – are expected to move back into the black at at least £0.2m, from a loss of £6.6m last time.
This performance, says Unbound, reflects the strength of both Hotter’s products and its multichannel approach to selling them – through its own and third-party websites, as well as through its shops, which now incorporate digital technology including its own 3D foot scanners.
That strategy has boosted customer interest in its products. By the end of its latest financial year, the retailer had an emailable database of more than 1m people – up from 767k a year earlier.
Ian Watson, chief executive of Unbound Group, says: “I am delighted that the progress we have made in resetting Hotter continues to be translated into improved financial performance and momentum. The partnership with M&S is further testimony to Hotter’s attractiveness to other best in class retail platforms. The development of the Unbound Group platform is also gathering pace, we have strengthened the management team and we are currently engaged in positive discussions with a number of potential partners.”
Supply chain insights
Unbound says that supply chain disruption was a challenge in the second half of its latest financial year, but that its UK manufacturing base in the UK gave it “a level of resilience and availability” and meant that those issues improved in the final quarter of the year. It now has the inventory it needs for its newly-launched spring summer 2022 collection, as well as fixed pricing agreements with some of its key suppliers.
Looking ahead, it expects its growth to stay on target.
Hotter is a Top100 retail brand in RXUK Top500 research.