Homewares retailer The Range chief executive Chris Dawson has cited “massive inflation” as being a key contributor to stagnant profits at the company last year as the high costs of fuel and other capital expenses frustrated growth.
The retailer reported flat pre-tax profits of £20.3m in the year to January 30. Capital expenditure at The Range leapt up to £23.5m in the period from £8.8m.
Speaking to Retail Week, Dawson said rising costs are making opening new stores increasingly expensive.
He said: “I’ve never seen inflation shoot up so much in my life. I think inflation and VAT will catch a lot of retailers out. I don’t think there are many people negotiating as hard as we are.”
However, Dawson added that he believed inflation would begin to level off in the middle of 2012.
Turnover increased from £212m to £249m in the year, and Dawson described current trading as “good”.
In the year, the 53-store retailer opened nine stores and has pressed ahead with expansion in 2011, with five stores opening and a further six planned before the end of the year.
Dawson declined to say how many stores he expects to open next year, but said it would be “slightly more” than the 2011 figure of 11.
The Range is on the brink of launching a financial services website, Themoneyrange.co.uk. It is likely to launch next week.