Online sales slow for The Works but frontlist book strategy ‘a great success’

Online sales for The Works have slowed by 16.9% according to its half-year trading update, although they remain 50% above pre-Covid levels, while a 2.1% total increase in sales is being attributed in part to the “great success” of its frontlist book range.

The retailer announced a change in strategy in May, when it outlined plans to expand its frontlist book ranges and capitalise on trends such as TikTok to build its “credibility and reputation” as a bookseller.

Its trading update, for the 26 weeks ended 30th October 2022, said: “The expansion of our frontlist book offer has been a great success, with recent new titles such as Diary of a Wimpy Kid: Diper Överlöde by Jeff Kinney (Puffin), The Bullet That Missed by Richard Osman (Viking) and It Starts With Us by Colleen Hoover (S&S) being particularly strong sellers.

“Online sales have been weaker in comparison, primarily due to the normalisation of shopping trends post-Covid, but have gradually improved throughout the period... Online sales growth continued to track behind stores, but we are encouraged that the rate of decline has slowed progressively as trading through this channel stabilises, and we continue to believe that there remains a significant opportunity for growth in this channel in the medium term.”

The update outlined that The Works had “delivered a resilient trading performance against the backdrop of an increasingly challenging consumer environment”. While sales online and in-store, the latter of which overall increased by 3.5%, were adversely affected during May due to operational issues in the aftermath of a cyber-security incident in March, from June onwards store performance was positive.

Particularly strong growth in this area was reported in the summer, “when the refreshed outdoor play range performed well, followed by a record ‘Back to School’ season”.

Overall the group’s operating cash cycle has now returned to normal after the two previous years, which exhibited an atypical pattern, due to the effects of the Covid-19 pandemic. The group’s financial position “remains strong” with net cash of £11m at the period end.

Gavin Peck, c.e.o. of The Works, said of the results: “We have delivered a resilient performance in the first half with positive sales growth overall, demonstrating continued progress against our ‘better, not just bigger’ strategy. Our more customer-focused product proposition has continued to resonate, supported by the hard work and fantastic customer service delivered by our colleagues, helping to offset the challenging trading conditions being seen across the market.

“Although it is very difficult to predict what Christmas will look like this year, we believe that the great products and fantastic value we offer will be more important than ever, with families still looking to celebrate Christmas but in a more affordable way. The Works has proven itself to be a resilient business and we remain confident in our ability to make progress on our strategy and deliver growth in the medium term, supported by a robust balance sheet.”