Early Christmas shopping hits sales at sofa specialist ScS
The retailer said pent-up demand for new furniture during the pandemic has eased and supply chain issues remain.
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Your support makes all the difference.Sofa specialist ScS says pent-up demand during the pandemic has eased significantly, with shoppers preferring to spend on Christmas presents earlier this year.
The company said like-for-like orders dropped 10.6% in the 16 weeks to November 20 compared with a year earlier, with a sharp fall in the last seven weeks in particular.
Bosses said supply chain problems, which have hit the entire retail sector, were also having an impact.
Shares subsequently collapsed more than 8%.
The extended product lead times currently being experienced across the furniture and wider retail industry are also having an impact on current purchasing trends
Like-for-like order growth was up 0.9% compared with the same period two years ago, before the pandemic.
But ScS added: “Over the last seven weeks, the group has seen a reduction in store footfall and conversion with consumers spending less on big ticket discretionary purchases.
“This appears to be driven by a change in behaviour with consumers shopping earlier for Christmas when compared with previous years.
“The extended product lead times currently being experienced across the furniture and wider retail industry are also having an impact on current purchasing trends.”
As of November 20 ScS’s order book was £131.9 million – £71.5 million above the same point two years ago – and online sales continue to grow, up 38.5% on a two-year basis.
Looking forward, the retailer said it was gearing up for the Boxing Day sales – a key period for furniture businesses – and was working with suppliers to avoid delays.
Partnerships with new UK suppliers to offer shorter lead times have also been signed, it added.
The company said: “Whilst it remains difficult to predict shopping habits and consumer engagement, the business is planning to approach this key period in a manner consistent with that which has proven successful in previous years.”