Halfords sales struggle
Posted on 23 Mar 2010
Halfords year to date sales have increased 1.3% vs. 2009 and just 0.8% on a like for like basis.
Revenue growth has been driven by Halfords car servicing and maintenance product, where sales grew by 13% like for like.
The level of growth in this high margin auto category indicates just how tough Halfords have been finding sales to come by in the cycle and leisure.
Halfords admit that leisure category sales have been "below internal expectations" with cycle sales increasing by only 1.9% like for like.
Halfords cumulative sales for the 50 weeks to 19th March have also only increased by 1.3% like for like and 2.6% in total.
A spokesperson for ACT said "against this background Halfords should stop claiming to have increased market share in the cycle sector, this clearly isn't the case. The business is obviously benefiting from strengthened own brand margins and is financially strong, but IBDs are leading market share growth."
ActSmart's research of specialist retailer businesses reflects a 4.2% like for like core sales growth in the last 50 weeks, rising to over 6% once cycle finance, cycle to work and other revenue streams are added. IBD core sales increased by 7.6% like for like in February.
Following the acquisition of Cyclescheme by Grass Roots, a leading employee benefits provider, Halfords now faces increased competition for Cycle to Work revenues from the IBD sector.
Halfords sales performance figures quoted relate to the UK and N. Ireland only. Halfords today announced its intention to close its seven stores trading in the Czech Republic and Poland this summer.
