Specialist electricals retailer Richer Sounds posted a 38.8 per cent fall in pre-tax profits to £3.7 million for the year to April 26.
Although inflationary rises in stores and at head office and tough trading conditions had an impact, chairman David Robinson said the scale of the change was exaggerated by a£1.3 million sale of fixed assets recorded in the previous year’s profits.
He said he was pleased with the performance but conceded: “When customers want a great deal, margins tend to suffer.”
He added: “We’ve had a couple of very successful years because we’ve been looking at our costs and at the moment we’re holding up.”
Robinson said business in the present year has been helped by mailshots to core customers listed on Richer Sounds’ database.
Retail Knowledge Bank senior partner Robert Clark said that Richer Sounds’ position in a tough market put it in the “firing line”, but that the retailer was still better placed than rivals such as Currys to weather the downturn.
He said: “Their stock in trade is an area where prices go down and where they start with high ticket prices, so of course they’re exposed. However, their specialist approach pays dividends in terms of a loyal customer base. Their positioning is pretty canny.”
Four stores opened during the year, giving the retailer a 46-strong portfolio. Next week a shop is due to launch in Southgate, north London, featuring the living room-style demonstration lounge that Richer Sounds has been installing in its branches since the beginning of the year.
About a third of the retailer’s stores now have demonstration lounges. Robinson said it wants to “take advantage of the property deals that are appearing, although we haven’t got any major expansion plans at the moment”.
Richer Sounds was founded by entrepreneur Julian Richer, who took it into the record books for profitability per square foot.
He said he was pleased with the performance but conceded: “When customers want a great deal, margins tend to suffer.”
He added: “We’ve had a couple of very successful years because we’ve been looking at our costs and at the moment we’re holding up.”
Robinson said business in the present year has been helped by mailshots to core customers listed on Richer Sounds’ database.
Retail Knowledge Bank senior partner Robert Clark said that Richer Sounds’ position in a tough market put it in the “firing line”, but that the retailer was still better placed than rivals such as Currys to weather the downturn.
He said: “Their stock in trade is an area where prices go down and where they start with high ticket prices, so of course they’re exposed. However, their specialist approach pays dividends in terms of a loyal customer base. Their positioning is pretty canny.”
Four stores opened during the year, giving the retailer a 46-strong portfolio. Next week a shop is due to launch in Southgate, north London, featuring the living room-style demonstration lounge that Richer Sounds has been installing in its branches since the beginning of the year.
About a third of the retailer’s stores now have demonstration lounges. Robinson said it wants to “take advantage of the property deals that are appearing, although we haven’t got any major expansion plans at the moment”.
Richer Sounds was founded by entrepreneur Julian Richer, who took it into the record books for profitability per square foot.
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