Sporting goods retailer JJB Sports Plc today (28 September) said it is turning to increased promotional activity in a bid to boost sales of autumn and seasonal merchandise over the next four months.
“The full year outcome remains heavily dependent on our performance during the important pre-Christmas and January sale periods,” explained CEO Keith Jones, “as well as the success of our promotional planning in the short term in the light of current volatility in sales.”
Describing current like-for-like sales as “volatile,” the company booked a 6% rise in revenue at stores open for at least a year in the four weeks to 26 September. This compares with an 18% gain a month earlier.
But Jones said the longer term prospects for retailers in the UK “remain challenging,” and the increase in VAT due in January 2011 adds to the uncertainty surrounding consumer expenditure.
The company revealed its plans as it narrowed its first-half operating loss to GBP24.6m (US$39m) from GBP41.9m a year earlier, helped by higher sales of replica football kit during the World Cup tournament.
Revenues in the 26 weeks to 1 August rose 10% to GBP184m, from GBP178.6m last time, with like-for-like sales up by 14.4%. Gross margin was up 8.2 percentage points to 42.2% from 34.0%
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By GlobalDataUnder the guidance of Jones, who joined JJB Sports in March, the retailer is in turnaround mode with a new ‘Serious about Sport’ strategy, as well as store refurbishments, better stock ordering and management systems, and development of its own-label product design and sourcing. But he said this “will not be a quick fix,” but will take up to three years to deliver.
The retailer, which trades from 249 JJB branded retail stores in the UK and Ireland and employs over 7000 people is also shoring up its management team, and separately said Debbie Robinson is joining the company as marketing director from The Co-operative Group.
