Argos’ digital sales grew 68% in the year ending 6 March 2021, with strong growth coming from home and office furniture, garden essentials and gaming.
Sainsbury’s has today (28 April) revealed its preliminary results for the 52 weeks ending 6 March 2021, with Argos putting in a strong performance for the group.
Argos’ digital sales grew 68% in the year, with 90% of sales starting online. Indeed, Argos’ strength in online and the Fast Track delivery helped Sainsbury’s to adapt quickly to the changes in the way people wanted to shop through the pandemic.
While standalone Argos stores were closed for much of the year during lockdowns, home delivery sales increased significantly and collection from Sainsbury’s stores was popular.
Over the year, the group welcomed over three million new customers to Argos and sales were boosted by particularly strong growth in home and office furniture, garden essentials and home entertainment, including games consoles such as the new PlayStation 5 and Xbox.
The grocer also provided an update on its transformation of Argos. It has closed 170 standalone Argos stores, as well as six Argos stores in Homebase outlets as part of its plan to reduce the number to around 100 over the next three years, reducing its operating costs by £105m by March 2024.
In addition, it has opened 30 new Argos stores in Sainsbury’s stores, 35 collection points and one new standalone store. This is part of the plan to reach 430-460 Argos stores in Sainsbury’s and reach 450-500 collection points by March 2024. As at 6 March 2021, Argos had 737 stores, of which 336 are stores in Sainsbury’s. Customers can also pick up products from 306 collection points in Sainsbury’s stores.
The integration of Habitat with Argos and Sainsbury’s has also picked up pace.
The retailer launched Habitat as its main home and furniture brand and has adapted its home and furniture ranges.
In addition, while Tu clothing sales were down 18.3% in the first half of the year, they recovered in the second half, increasing by 1.5% and the brand continues to gain clothing market share.
Tu online performed strongly throughout the year, with sales up 65% and full price sales up 15% as customers stocked up on pyjamas, loungewear and childrenswear.
Overall for the FY, Sainsbury’s saw grocery sales increase 7.8%, general merchandise sales grow 8.3% and digital sales increase 102%.
However, underlying profit before tax was down 39% to £356 million, with the benefits from strong sales growth more than offset by £485 million of direct Covid-19 costs.
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