The January Sales are big-ticket retailers’ Christmas as shoppers have traditionally taken advantage of a plethora of deals to snap up new sofas or beds.
But how did the cost-of-living crisis impact spending this year? Did shoppers take the opportunity to snap up furniture deals or did they batten down the hatches after Christmas?
Retail Gazette speaks to some of the UK’s biggest furniture retailers to find out what happened.
Shoppers seek value
The cost-of-living crisis did not derail spending on home but shoppers did seek out value during the January Sales.
Bensons for Beds boss Nick Collard says the retailer had a “good” January Sales with revenue in line with expectations. This comes on top of a 7% like-for-like rise in the final quarter of 2022.
However, he admits that the cost-of-living has had an impact on shopping behaviour with customers seeking out value.
“Consumers that shopping are searching for value for money so there’s more of a concentration around events like Black Friday, January Sales, and when people are getting paid at the end of the month,” he says.
Shoppers may be focusing on value for money, but Collard points out that this means more than just price.
“We’ve seen more of a mix going towards our better and best ranges which feels a little counterintuitive for the situation that the country is in,” he says, adding that people are “willing to spend money on what they see as a better product”.
It was a similar story at furniture retailer The Cotswold Company.
CEO Ralph Tucker says: “Whilst some customers are trading to entry price-points, we are still seeing great quality and craftsmanship as an important factor in purchasing and our more premium ranges are doing really well.”
The Cotswold Company’s sales in January were “just ahead of expectations” with retail “slightly stronger” than predicted, while things were “a little tougher online”, according to Tucker.
ScS returned to like-for-like growth, which rose 2.6% in the 10 weeks to 28 January, which takes in the key Sale period.
This is a notable uplift as between 31 July to 19 November sales had fallen 9.1%. The retailer says it has been “encouraged by recent order levels”.
Oak Furnitureland CEO Alex Fisher says it is still benefiting from the rise in flexible working with people investing to transform their homes into work spaces.
He says shoppers are “focusing on what adds value to their lifestyles” and are “investing in stylish, quality furniture as their homes are increasingly on show”.
The trend towards homeworking is also benefiting Ikea right now.
Ikea global retail boss Tolga Öncü says the retailer delivered a “really, really great performance” over Christmas and “saw a significant increase in sales”.
But it is storage solutions, rather than big furniture purchases that are really driving sales as shoppers invest to make their homes, which for some are now also their offices, work.
“There’s a lot of need for storage. People say they are tackling a lack of space, and that’s crucial about how they feel about their homes,” says Öncü.
When is peak?
But are the January Sales still the peak for big-ticket retailers or has the discounting frenzy of Black Friday usurped it?
Collard says that Black Friday, which was “very successful” for Bensons for Beds, has not cannibalised its January Sales, however, he admits there was less of a rush post-Christmas.
“If you go back four or five years ago, the week directly after Boxing Day was very big,” he says.
“What we’re seeing now is that trade is being spread out more evenly over the January period rather than concentrated in the first seven to 10 days as it might have been pre-pandemic.”
The Cotswold Company did see some shoppers bring forward purchases to Black Friday as they sought out bargains.
However, Tucker says this trend “has affected fashion and electricals much more than home”.
Omnichannel investment
With value more important than ever right now, shoppers are searching around for not only deals but to ensure they make the right purchase.
Oak Furnitureland’s Fisher says more online research is taking place than ever and calls its website a “virtual showroom”.
“Many of our customers undertake a lot of research online before going to visit a showroom so we’re always finding new ways to help customers imagine exactly how our furniture will look in their home,” he says.
“We’re helping to create a more seamless and personalised shopping experience for our customers in a furniture space where the future is about the well-integrated omnichannel journey.”
Similarly, Bensons for Beds attributed its strong sales growth in the last quarter to its investment in stores and online.
Collard explains the furniture retailer’s big investment into its digital team has enabled it to make key changes in the look and feel of its ecommerce platform, which saw online sales skyrocket 41% in the final quarrter of 2022.
“One of the things that we know around this sector is 90% of customers start their journey online, but they may choose to go into store and either finish that transaction, or come home and finish that transaction online.
“It’s really critical that we weave those two things together,” he explains.
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