Sosandar has experienced a 27% decrease in sales over the last six months.
- The change in sales follows the retailer’s decision to focus on full-price sales and reduce discounts by 85%.
- Despite falling sales, Sosandar significantly reduced its pre-tax losses by half to £0.7m.
- The company’s gross margin improved to 62.2%, compared to 55.4% previously.
- Sosandar’s expansion included opening four new UK stores, increasing new customer numbers and online traffic.
Sosandar has reported a 27% decline in sales to £16.2 million over the last half-year, down from the previous £22.2 million, a result aligned with its strategic shift towards full-price sales. The company has notably reduced discounts on its products by 85% as part of this shift, aiming to train customers to adopt a full retail price norm.
Despite the downturn in sales, this strategic move yielded financial benefits for Sosandar, with a significant reduction in pre-tax losses of 50%, bringing them down to £0.7 million. The margin improvements speak to the effectiveness of prioritising profitability and cost management over volume sales strategies.
Further enhancing the financial outlook, Sosandar reported a rise in their gross margin to 62.2%, up from the previous year’s 55.4%, marking a clear focus on improving margin and reducing unnecessary financial losses.
The retailer’s strategy bore fruit as customer adaptation to full-price purchases mirrored their experiences at partner outlets such as Next and M&S. Each successive month showed a narrowing sales gap, indicative of customers increasingly accepting the full-price model.
Beyond online initiatives, Sosandar’s market expansion into physical stores has been marked by the opening of four stores across the UK. This move not only drove sales but also attracted a significant number of new customers, resulting in increased foot traffic and notable online engagement from local consumers.
Sosandar’s partnership strategy remains robust, exemplified by its launch at Arnotts in Dublin and a new licensing agreement with Next to develop a homeware range, signaling a broadening of its market reach.
The outlook remains positive with trading expectations for October and November aligning with full-year market forecasts, anticipating a revenue of £40.5 million and a pre-tax profit of £1 million, reflecting further improvement in gross margins now at 64%.
Sosandar’s strategic shift towards full-price sales and store expansion has shown promising results, suggesting sustained growth and profitability.
