Radley sales surge in latest year, US is booming, plans European expansion
A couple of weeks ago at its 20th anniversary party, Radley’s CEO Justin Stead said the firm had enjoyed “an immense year” and that this would become clear when the bag brand’s full-year figures were released in November.
Well, those figures are out and we can see what he was talking about. The company’s sales rose as much as 17% to £85.9 million in the year to April and underlying earnings surged from £3.9 million to £6.3 million.
Thos figures are a testament to the brand’s ability to differentiate itself in a crowded UK fashion market that’s seeing even some of the biggest names struggling if their offer isn’t compelling enough.
But the company isn’t only focused on its domestic market with its 15.6% sales increase in the six months since its financial year ended having been helped by its expansion in the US. It’s only been a year since the company entered North America (via Macy’s and QVC), which was a pretty brave move given how the US has been a graveyard for so many British brands and given how tough times are at the moment.
But it seems to have paid off with sales from that market now accounting for as much as 11% of its total turnover.
Justin Stead said: "We launched 13 months ago and have already beaten even our most optimistic of sales targets. We are now in 200 Macy stores in addition to a robust macys.com performance and significant shop-in-shop contribution in key Macy’s locations nationally.
"Additionally, our only other US partner, QVC television, has delivered a stunning Year 1 performance with Radley which saw target-beating performances exceeding all expectations with initial shows. Our direct online business in the US has seen web sales increase by a very positive 95% due to the halo effect from the success of both Macy’s and QVC launches."
The company currently has 32 stores in the UK but also sells from its webstore in 46 countries. it has five dedicated websites in Japan, the US, the EU (two), and the UK, with 9 million visits each year.
In October, Justin Stead had laid out an ambitious strategy and talked up its US performance, as well as its “booming business in China with Tmall” and its strength in Japan and Australia.
That's no surprise as international sales rose by 96% last year "and it is likely that significant increases are anticipated in 2019 based on the current trend." Stead added: "The US business is nascent, there is much more to come through organic growth including growth from the company’s US website and the prospects of new routes to market. There is a clear opportunity for China to also be another large growth market initially with TMall, where [the] performance has been exceptional.
"The company is now selling very successfully in Australia through its major department store partner – Myer – and we expect to see significant further expansion in the current year. The QVC business has extended into new markets – most recently in Italy and Germany. Furthermore, the company has relaunched its business at Karstadt in Germany, and is in advanced talks to expand into other European markets."
Stead is hoping that the current-year sales of around £100 million could reach £200 million within three or four years and if it maintains its growth trajectory, that’s certainly feasible.
The company is also ramping up its marketing efforts having recently named Poldark star Eleanor Tomlinson as its first brand face.
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