Music Magpie founder and chief executive Steve Oliver has said the company is focusing on “buying more, selling more and renting more” after reporting expected, albeit lacklustre, full-year results.
The online retailer reported a 14.2% decline in gross profit, a 46.7% decrease in EBITDA and a 0.2% fall in revenue, despite reporting record numbers for Black Friday.
Oliver said he expected these results, as the company performed better last year due to success during the pandemic, but he was pleased with its consumer tech growth.
He told Retail Week: “Our tech sales grew by 12% and our rental subscriber base hit 30,500 at year-end.
“Consumer tech makes up nearly 70% of revenue and we’re deciding to focus on this area as well as buying more, selling more and renting more as a massive opportunity for growth.”
Music Magpie said it expects to see more of a demand for its services amid the cost-of-living crisis, as its refurbished offering provides consumers with a more cost-effective and sustainable way to use tech.
Oliver said: “We look to present high-quality refurbished device with a 12-month warranty. Typically, the average selling price is between £350 and £400 and in a cost-of-living crisis that’s a great alternative to paying £1,000 for a new device.
“There used to be a perception that second-hand tech was either too niche or perhaps grubby, but now I think consumers realise it’s smart as they are saving money and helping the planet.
“They are less bothered about getting the latest iPhone from Apple and are moving towards refurbished tech.”
The retailer has been expanding its business by rolling out nearly 300 kiosks in Asda and it is making progress with Magpie Circular, which works with corporate clients to help them recycle their unused tech.
Its rental service is also part of the strategic growth strategy, which Oliver says aims to focus on long-term sales and profitability.
He said: “There’s an interesting dynamic where people are renting instead of buying and the rental offer is great value and provides flexibility.
“At the end of the contract, customers can choose to keep the same device and take a discount or pay the same amount of money and swap the old device for a newer one.
“The rental offer is a big focus and differentiator for us, and we’ve just launched a 24-month offer which we’re excited to see develop.”
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