What's Happening?
The Works, a retailer, has announced that it is on track to meet its full-year profit targets despite a slight dip in first-half trading. In the 26 weeks leading up to November 2, total sales decreased
by 0.3% to £123.8 million, while like-for-like sales increased by 0.3%. The company has seen a 4% rise in store like-for-likes, driven by its 'Elevating The Works' strategy, which focuses on customer-centric marketing and improved in-store standards. However, online sales have dropped by 36% due to operational disruptions related to transitioning to a new third-party fulfillment partner.
Why It's Important?
The Works' ability to maintain its profit targets despite challenges in online sales underscores the importance of strategic initiatives and in-store performance in the retail sector. As online sales face disruptions, the company's focus on enhancing physical store experiences and customer engagement becomes crucial. This situation highlights the ongoing challenges retailers face in balancing online and offline sales channels, especially during peak trading periods. The company's strategy may serve as a model for other retailers navigating similar challenges in the evolving retail landscape.
What's Next?
The Works plans to optimize store performance during its peak trading period and aims to deliver full-year pre-IFRS 16 adjusted EBITDA of £11 million, aligning with market expectations. The company will continue to focus on screen-free activities for families, which resonates well with customers. Additionally, Simon Hathway will step down as non-executive director in January to assume a full-time executive director role at B&M, indicating potential leadership changes that could impact future strategies.
