Value homewares retailer Dunelm is expanding into furniture as it seeks to expand the business.
Dunelm chief executive Nick Wharton said the retailer is “carefully expanding” into furniture, predominantly cabinetry. It will also launch its first garden furniture range towards the end of its current financial year.
“Customers trust the Dunelm brand and are quite happy to buy furniture,” said Wharton.
The move comes after the retailer posted a pre-tax profit rise of 2.9% to £61.6m in the 26 weeks to December 28. Total sales were up 4.8% to £356.3m while like-for-likes fell 0.9% after a poor first quarter that was impacted by the unusually warm weather. Like-for-likes fell 5.3% in the first quarter before rising 2.9% in the second quarter.
Wharton said he was pleased with the period overall and that the retailer had gained share in a tough market.
“From a trading perspective it felt like a game of two halves,” said Wharton. “We’ve continued to make good progress across the whole business. We’ve achieved a lot from a strategic point of view. We’ve repositioned the brand. We had our first national TV trial, and the initial results are pleasing and are slightly ahead of expectations.”
Wharton also pointed to improvements in customer service and a new online fulfillment centre that opened in October. The facility has enabled Dunelm to improve its online offer, upping the number of web products from 11,500 to 17,500 year on year, and improving the average delivery time from six days to three.
Online sales increased 50% in the half year, and multichannel sales now represent 6% of total revenues. The retailer opened five net superstores in the period, taking its store count to 131.
Wharton said it was too early to call a recovery in the home sector because disposable income is still under pressure. However, he added an improving housing market and confidence over jobs were “positives”.
Dunelm appointed Steve Knights as its commercial director last month. Knights was most recently global sourcing and value chain director at Home Hetail. He has worked at the Argos owner since 2000.