Vadera enjoys sweet smell of success
PERFUME retailer The Fragrance Shop saw its pre-tax profits rise by 40% to £7m in the year to March 31 even though turnover climbed by just 3.3% to £57.2m.
The Trafford Park-based company’s founder and CEO Sanjay Vadera said that profit growth at the firm had been driven by several factors including “better management of inventory, our cost base and promotional campaigns”.
He said that the growth in profits had allowed the company to pay back all of its outstanding bank debts in full. At the beginning of the year, the company had owed £1.4m in bank debt, but strong cash generation allowed it to pay this off.
In total, the firm opened 11 new stores last year and closed four stores. However, since its year end it has bought eight Perfume Point stores and the Perfume Point from Per-Scent Group – another company owned by Vadera which is largely involved in the distribution and wholesale of perfumes to retailers and wholesalers.
The new additions have contributed towards a 23.5% increase in revenues during the first quarter of its current financial year. Like-for-like sales are also up 12.2%.
Nigel Lawmon, managing director The Fragrance Shop, said: “We are achieving outstanding like-for-like sales growth as a result of listening to our customers and giving them what they are asking for – a great range of products, being first to market and offering the best in value, as well as friendly, knowledgeable service.
“Despite discretionary spend reducing, people don’t want to see their standards of living fall and in the same vein they want to feel confident that every penny they are spending is good value.
“We are very well positioned to exploit the current consumer market conditions”.
The firm has already opened its first store this year in Wakefield and is trialling a new store design in Cardiff, which is operating from a bigger footprint and offering a more varied range of products, including some niche luxury brands.
Vadera said: “We’re optimistic about the outlook for The Fragrance Shop and we hope to see the strong start develop into another fantastic trading year.”
