After numerous occasions where Halfords considered acquiring smaller rival Evans Cycle because of its relationship with key suppliers, the automotive and leisure products retailer chose instead to develop its own high street cycling brand: Cycle Republic. In January, then CEO Matt Davies had said he believed there was the potential for 100 Cycle Republic shops and in a statement this morning, current Chief Exec Jill McDonald cited that following the fifth store opening in May, “there are further openings planned across the country”.
It looks like the company‘s strategy to focus on bicycle sales was the right path.
Sales of bikes and car maintenance services have gained momentum, driving Halfords‘ first quarter sales.
Like-for-like sales grew 4.2%, boosted by the retailer‘s premium bikes category and cycle repair division. Previously an underperforming division, Halfords‘ ‘travel solutions‘ category also grew, with roof boxes, cycle carrier and child safety seats selling strong.
McDonald outlined competitive prices and knowledgeable staff as being a major factor in these successes.
Halfords was short-changed since its car enhancement category saw a 31% increase in sales of in-car connectivity equipment and dashboard cameras but was offset by weaker car cleaning services in the quarter.
McDonald, who joined Halfords recently from global fast-food giant McDonalds said:
“Our Retail business continues to deliver a broad-based top-line performance, against two previous years of strong like-for-like growth. Cycling continues to grow; the highlights in the quarter being Premium Bikes and Cycle Repair, with sales up 8% and 24% respectively.”
“Our Getting Into Gear plan continues to progress with pace, and we‘re on track with the Retail trading initiatives and Autocentres priorities we outlined in June.”
Elsewhere, Halfords has seen some solid multichannel growth, with online retail sales up 8.2%, and 91% of online orders collected instore.