Majestic Wine’s broadened appeal drives sales up

chief executive Steve Lewis said the retailer’s change to its minimum order rules - it has cut its minimum order from 12 to six bottles - had brought “an influx of new customers” to its stores.

The number of customers who made purchases was up 54,000 to 472,000 in the 12 months to March 29 over the previous year. The average spend was down just 4% at £129 but the number of transactions was up 14.6% to 1.7 million.

Lewis said: “More people are interested in food and wine these days and we are seeing more 20-something couples coming into our stores now.” He added that younger shoppers might have been deterred by the previous 12-bottle minimum purchase “if they didn’t have a car or much storage space”.

He said Majestic Wine also benefited from new customers who had previously shopped with collapsed chain First Quench, and added: “It is impossible to predict what will happen after the Budget but we remain confident in the strength of our brand and our appeal.”

Total sales were up 15.6% to £233.2m, including £12.4m from fine wine specialist Lay & Wheeler, which Majestic acquired in March 2009. Like-for-like sales in the UK were up 8.4%. Current trade remains strong, with like-for-likes in the 10 weeks to June 7 up 7.3%.

Lewis said that, during the worst of the recession, Majestic was hit by a downturn in business customers and champagne sales, but both were now “in positive territory”.

He also said sales of fine wine (£20 and above per bottle) had increased 22.7% on last year, as “more people are treating themselves, since everyone is working so hard these days they think they deserve it at the end of a long week, and it’s still cheaper than eating out”. He said fine wines were now in 50% of its stores, and would be rolled out to all shops in two to three years.