Marks Electrical ‘ready to weather cost-of-living crisis’
Around four in five of the company’s sales are so-called ‘distressed purchases’.
Marks Electrical has said it is well-placed to deal with the impact of the cost-of-living crisis because most of what it sells is necessary for people’s homes.
The business said it gets most of its money from so-called “distressed purchases” – products that customers buy because they have to, not because they want to.
“At present, 80% of our revenues come from distressed purchases, providing the group with a defendable position during a cost-of-living crisis,” the company said, as it promised to also look after staff during the squeeze.
The business saw revenue grow by 44% in the year to the end of March, hitting a record £80.5 million.
But it said pre-tax profit had dropped from £7.2 million to £6.4 million in the 12 months.
The business may have my name on it, but it really is about teamwork
Chief executive Mark Smithson said: “Internally, we continue to monitor our pay structures and the cost of living to ensure all our employees are well-rewarded for their hard work, offering competitive salaries, commissions, and bonus structures across the board.
“The business may have my name on it, but it really is about teamwork, and I look forward to fostering our team spirit and family-orientated culture as we grow the business to become a go-to destination for premium electrical appliances in the UK.”
Marks Electrical listed last November after years of heavy growth. Since a spike later that month, shares have been slowly sliding, dropping more than 15%.
On Wednesday they regained a little ground, with a 2.2% rise following the news.
Mr Smithson said the business has expanded its range of products due to the cost-of-living crisis.
It now has more products in all price ranges, and has also put in new credit solutions which can let customers spread payments.
He added: “Our ancillary services, including add-ons and warranties, make up a very small proportion of our revenue, mitigating any impact on the group should customers cut back on these options.”