Rough Trade is at “critical stage of growth” as it prepares to open its first overseas store in New York and records strong start to the year.

In the first quarter of 2013, Rough Trade – which trades from two shops in London and an online store – recorded sales up 25%.

While a dramatically smaller business compared with HMV, Rough Trade’s strong performance contrasts with its large-scale rival, which hit the buffers in January before being bought by Hilco this month.

Rough Trade will open its New York store later this year. Located in Williamsburg, Brooklyn, the shop will be twice as big as the flagship Rough Trade East store on London’s Brick Lane and will feature a live venue with balcony and bar, exhibition room and cafe.

Stephen Godfroy, co-owner of Rough Trade, said: “In the coming years, we will open stores across the UK, as well as further stores across the globe.

“As a company, we’re starting a critical stage of growth, beginning to reconfigure our internal structure to reflect our growth ambition, protecting the essence of the company while embracing the added changes required to scale.”

Godfroy said Rough Trade is eyeing UK cities to open further stores and hopes to announce a shop opening this year.

“As with any location, it will come down to finding the right property, at the right price, at the right time. So, we have to remain flexible as to which UK city is our first outside of London, it being dependent on how these variables match up.

“We’d like to confirm our next UK store this year, with others soon to follow.”

He said the New York store would act as a brand-building exercise as well as an “ancillary revenue stream”.

Godfroy added that online sales are an “important element” of the business. Web sales increased 60% in the period. Rough Trade sells both physical products and digital downloads and runs subscriptions offers Album of the Month and Tracks of the Week.

The retailer will also roll out its Rough Trade Card, which allows customers of the London stores to download digital copies of the physical items they have purchase in store.

“Our tills marry the offline purchases with the customers online account, creating a seamless multi-format, multichannel offer,” said Godfroy. “It’s a world-first, developed by us, something we expect to prove very popular when we introduce into the US later in the year.”

Godfroy said, despite some forecasting the death of music retailing, the outlook is “incredibly exciting and full of opportunity”.

“Being more of a social currency than film and games, music retail can dovetail non-music streams into the retail model, such as cafe and live performance,” he said.