Having recently released their profit statement for the financial year ending 29th April, things are looking positive for SuperGroup, the company that own Superdry. The results come after an extremely successful promotion strategy in the UK and abroad, as well as greater diversification into the wholesale market.
What are the numbers?
Revenues have gone up by 27.2% compared to the previous financial year and hit £750.6m. This is comprised of £501.6m from retail revenue, a 20.6% increase, as well as £248.9m from wholesale revenue, a 42.9% increase. All manner of sales routes look extremely healthy, and even e-commerce sales saw an increase of around 35%. Perfectly in line with projected forecasts, these numbers should mean an end of year profit of between £85m and £86m.
How did they do it?
In 2015, SuperGroup laid out their plan of attack for the coming years and have, thus far, stuck to it and are busy reaping the rewards. In the UK they have a heavy promotional campaign underway that involves the release of new product lines to remain current and appealing to their 20 to 30 age range demographic. On top of that, the hugely popular TV star Idris Elba has been heavily involved in their recent premium menswear launch at their flagship Regents Street store in London. Elba, aged 42, is perfect for expanding their target market as his high profile involvement with the brand has helped increase their popularity amongst older generations.
On top of UK sales, the brand has worked hard to improve their overseas exposure, in particular targeting North America and China. This plan to create a global lifestyle brand has been dramatically supported by the falling value of the pound following the announcement of Brexit last summer. This decreased price of sterling makes the cost of importing Superdry abroad much cheaper and is the ideal stepping stone to help the brand make a dent in these markets.
What does the future look like?
As of now, the wholesale market for Superdry looks like the most promising route for continued growth, and despite it having a lower profit margin, high sales levels should be enough to continue to strengthen the company’s balance sheet. The future of Superdry looks brighter than ever, as long as they can continue to make use of current circumstance and deal with new issues. If the pound starts to strengthen over time, then no doubt this will affect the relative cost of their goods abroad; however, hopefully, the brand development they are experiencing now is enough to cement themselves in the market.