Rhythm & Booze owner R&M Swaine has hailed the turnaround of the 34 former Threshers stores it bought when First Quench Retailing collapsed into administration.
At the end of its financial year [30 June 2010] like-for-like sales in the off-licences, many of which were loss-making, were ahead by 53%, R&M Swaine revealed in its latest set of accounts.
"What the stores needed was a reasonable level of stock," managing director Martin Swaine told The Grocer. "And we're a lot more competitive with our pricing and marketing."
Swaine said that buy-two-get-one-free wine deals at FQR's stores artificially inflated the price of single bottles and alienated customers. "It was forcing you to spend more money than you wanted. My prices are lower to begin with and those numbers are even more of an achievement because I've got to sell more products to get the sales up," he said.
The number of transactions in former FQR stores were up 80% to 90%, Swaine added, and the average selling price was 20% to 25% lower.
R&M Swaine's turnover grew 27.9% to £64.09m over the period while pre-tax profits fell 26% to £0.58m. Swaine said he was "absolutely" confident profits would return to 2009 levels.
"When you absorb so many new stores and have to invest in them you take a hit. It takes time to build margins up and control overheads," he said.
R&M Swaine spent £876,000 to acquire tangible assets during the year. Swaine said most of that sum was spent improving the stores by adding new till systems, fascias, extra shelving and refrigeration.
He also confirmed he was looking at the seven Oddbins stores for sale in Yorkshire and would decide whether to make an offer on them imminently. "They are good locations but they're also very expensive to operate because of the rent and rates," he said.
A trial of a jointly branded store with Frozen Value, which had been scheduled to open in 2009, would begin in the next few months, Swaine added.
At the end of its financial year [30 June 2010] like-for-like sales in the off-licences, many of which were loss-making, were ahead by 53%, R&M Swaine revealed in its latest set of accounts.
"What the stores needed was a reasonable level of stock," managing director Martin Swaine told The Grocer. "And we're a lot more competitive with our pricing and marketing."
Swaine said that buy-two-get-one-free wine deals at FQR's stores artificially inflated the price of single bottles and alienated customers. "It was forcing you to spend more money than you wanted. My prices are lower to begin with and those numbers are even more of an achievement because I've got to sell more products to get the sales up," he said.
The number of transactions in former FQR stores were up 80% to 90%, Swaine added, and the average selling price was 20% to 25% lower.
R&M Swaine's turnover grew 27.9% to £64.09m over the period while pre-tax profits fell 26% to £0.58m. Swaine said he was "absolutely" confident profits would return to 2009 levels.
"When you absorb so many new stores and have to invest in them you take a hit. It takes time to build margins up and control overheads," he said.
R&M Swaine spent £876,000 to acquire tangible assets during the year. Swaine said most of that sum was spent improving the stores by adding new till systems, fascias, extra shelving and refrigeration.
He also confirmed he was looking at the seven Oddbins stores for sale in Yorkshire and would decide whether to make an offer on them imminently. "They are good locations but they're also very expensive to operate because of the rent and rates," he said.
A trial of a jointly branded store with Frozen Value, which had been scheduled to open in 2009, would begin in the next few months, Swaine added.
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