Since changing its pricing strategy to encourage clients to pay full RRP (recommended retail price), Sosandar has reported a 27 per cent decline in sales over the last six months. As sales dropped to US $ 20.38 million from US $ 27.93 million in the same period last year, the apparel store reduced its pre-tax losses by 50 per cent to US $ 0.88 million in the half-year ending 30th September.
Sosandar reduced the quantity of discounts on its website by 85 per cent and moved away from frequent price promotions, which was blamed for the income drop.
In spite of this, it claimed that the monthly sales difference between the previous year and this one decreased as consumers become used to paying the full RRP, just like they do when they buy from third-party partners like Next and M&S.
The brand’s emphasis on increasing profitability and margin is seen in the retailer’s improved gross margin, which increased to 62.2 per cent from 55.4 per cent the year before. Pre-tax losses were significantly reduced as a result of its cost-cutting and margin-boosting approach.
Sosandar opened its first four physical locations in the UK around this time, and they saw a lot of foot traffic and great trading. New consumers accounted for almost 65 per cent of in-store purchases, and the company noticed a discernible increase in internet traffic in the regions where the stores are situated.
Additionally, after selling online through Arnotts’ website, Sosandar opened an in-store location at Dublin, Ireland, and maintained its profitable connections with Next and M&S.
With revenue expected to exceed US $ 50.94 million and a pre-tax profit of US $ 1.26 million, the company reported that trading in October and November had matched full-year market forecasts. The company’s average gross margin increased from 62.2 per cent in the first half to 64 per cent in the second half as customers continued to adjust to the full-price model.
