Sales of footwear over the internet continued to grow in the Netherlands and Belgium during the first four months of this year, but the rationalized Macintosh Retail Group continued to improve its market shares in both countries - especially online - thanks to its omni-channel strategy.
In discussing the company's results for the first half of 2015, which show declining losses, the newly minted chief executive of the Dutch-based group, Kurt Staelens, noted that the growing segment of cross-channel shoppers has come to represent nearly 30 percent of shoe purchases and that they spend more than twice as much a consumers who purchase shoes exclusively online.
In the first six months of this year, the revenues of Brantano, Manfield, Scapino and other shoe retail chains managed by the group in the Benelux countries declined by 9 percent to €203.7 million. This was due mainly to a decline in the number of stores in the region from 614 units a year ago to 557, including 59 full-price stores that have been converted to off-price outlets.
The first quarter of the year was weakened by the clearance of excess winter stocks, but sales improved by €1.0 million to €118.3 million in the second quarter.
Market research shows that shoe retail sales were off by 0.4 percent in the Dutch market in the January-May period, with an increase of 3.2 percent in volume offset by a drop in average prices of 3.5 percent. In terms of value, sales in physical stores declined by 3.3 percent, while sales over the internet increased by 14.2 percent.
During the same period, Macintosh underperformed in the Netherlands offline, with decreases of 1.5 percent in volume and 2.2 percent in value at its physical stores. However, its online sales in the country went up by 22.3 percent.
The group outperformed the market in Belgium and Luxembourg online and offline during the same four-month period. It declined by 0.4 percent in an offline market that went down by 6.8 percent. The group improved by 19.2 percent online against market growth of 13.4 percent.
Macintosh reported an operating loss from continuing operations of €11.9 million for the first half, down from €19.4 million in the year-ago period. The results don't include those of Nea International, which was sold last May, or those of Kwantum and the group's shoe retail operations in the U.K., represented by Jones Bootmaker and Brantano UK.
Macinstosh is still in the process of receiving takeover bids for all these operations. Its two shoe retail chains in the U.K. had an underlying operating loss (Ebitda) of €3.9 million in the first half of this year, higher than the €1.1 million loss of the year-ago period, due to price promotions. Their sales increased by €10.2 million to €112.9 million in euros, but they were off by €2.9 million in pounds sterling.
Thanks in part to a capital gain of €16 million on the sale of Nea, the group's net losses for the period declined to €4.4 million from €31.2 million a year ago.
Meanwhile, Macintosh is investing heavily in the refitting of its remaining shoe retail formats in the Benelux countries, generating better results. Ten more Manfield stores adopted a new concept in the first half of this year, and sales went up by 14 percent in the reopened stores during the second quarter.
The new integrated omni-channel concept launched for Brantano in Belgium last April is producing a similar increase in sales and a 23 percent improvement in gross profits. A second pilot store will be opened in August.
The group is about to complete the development of a new store concept for Dolcis, and a pilot store will be opened in The Hague during the second half of this year.
The 3D Perfect Fit program for children is now fully operational at Brantano in Belgium. A total of 210,000 personal foot passports have been issued to customers. On average, these customers spend 25 percent more and return only 15 percent of the merchandise that they have ordered, 10 percentage points below the return rate for other customers and 30 percentage points less than the figure for pure e-tailers.