Online sales boost for The Works during lockdown
Retail chain The Works has seen strong online demand during the coronavirus lockdown, with sales up more than three times the equivalent period last year.
The unprecedented level of demand and the Birmingham-headquartered company's strict adherence to social distancing and additional health and safety measures at the distribution centre has required it to limit daily sales volumes.
The Works is working closely with its third-party fulfilment partner to expand its online fulfilment capacity both in the short term and to support increased volumes through peak trading over Christmas.
For the year to April 26, the chain which sells books, gifts, arts, crafts, toy and stationery, saw revenue rise 3.5 per cent.
All stores, including those in Cannock, Halesowen, intu Merry Hill, Oswestry, Shrewsbury, Stourbridge, Telford Shopping Centre, Walsall, West Bromwich and Wolverhampton, are currently shut.
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Overall like-for-like sales in the year to March 22 – the day before all stores were closed due to the Covid-19 outbreak - were up 0.7 per cent, with growth both in stores and online. During the period, the company opened a net 37 new stores, taking the total number of stores in the estate to 534.
The Works returned to positive like-for-like sales growth during the peak Christmas trading period. This momentum continued and before the outbreak, the company was trading in line with the board's expectations and was on target to be debt-free at year end.
The company saw a significant increase in sales, both in stores and online, before the store closures, with overall like-for-like sales up 81 per cent in the week to Sunday, March 22, reflecting strong customer demand for products to support ongoing education of children, mindfulness materials to support mental health and products to 'beat the boredom' during this period of social distancing.
The new store roll out programme is currently suspended, with the exception of a small number of stores where the company is legally committed, and discussions with landlords to reduce rents whilst stores are closed are ongoing
All of the company's store staff, the vast majority of its retail distribution centre workforce and a significant proportion of its support centre team has been furloughed under the Government's job retention scheme. The company agreed to top up the additional 20 per cent of salary for these colleagues for the month of April.
Chief executive Gavin Peck has taken a voluntary 33 per cent pay reduction, Catherine Glickman and Harry Morley (non-executive directors) have waived 33 per cent of their fees and the chairman Dean Hoyle, has waived 100 per cent of his fees. These reductions will be in effect for three months.
The company continues to monitor the impact of the pandemic closely and is putting in place plans to reopen its stores at the appropriate time, subject to Government guidelines.
