Bestway Retail ‘optimises’ supply chain ops amid ongoing stabilisation
Bestway Retail has announces changes to the way it supplies its customers as it reports an increase in operating losses in the last year, from £2.5million in 2021 to £3.2 million in 2022, amid its ongoing stabilisation of the business.
In accounts filed at Companies House, the company said that it was moving and simplifying its supply chain by supplying its retail customers through the supply chain and depots of its immediate parent company, Bestway Wholesale.
The transition “is expected to deliver much better and efficient service to our franchisee partners on a long-term basis”, a statement from the directors said.
It said that the company had concentrated on integrating the business within the Bestway Group structure, “materialising group synergies and efficiencies opportunities” in a bid to optimise the wider supply chain operation.
The Bestway Group acquired Conviviality’s retail businesses in April 2018 for £7.25m, but later restructured the retail business under Bestway Retail, which operate under the Bargain Booze symbol group, Wine Rack and Select One fascias.
Most of the stores are operated as franchisees, although there are a number of corporate stores (down from 167 to 132 in the last year, following a review of less profitable stores).
In the 12 months to 30 June 2022, the company reported operating losses of £3.2million (compared to £2.5million in 2021), which it said were “in line with expectations”. It is still less than the operating losses recorded in 2020, which stood at £8million.
Turnover also fell, down from £396m in 2021 to £352million in 2022, but this was part of a strategic plan to boost gross profit margin while working capital was improved buy better management of stock and debtors, it said.
Operating losses improved, however, from a loss of £0.8m in 2021 to £0.3million, and gross profit margin now stands at 6.5%, up from 5.5% in 2021. Working capital also rose from a loss of 2.2m to £1.3million.
The business operates both as a retailer and also wholesale operator for franchisees, with around £216m from its wholesale business and £133m from its retail business.