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Next’s direct sales, which is mainly online, grew far faster than estimated U.K. e-retail growth.
Direct sales are growing much faster than store sales for United Kingdom-based retail chain Next Plc.
Direct sales, which Next says is made up mainly of online sales, rose 18.8% in Q2 compared to the same quarter a year earlier, while store sales rose 6.4%. Total sales for the second quarter rose 10.7% year over year, Next says. Next, No. 15 in the Internet Retailer Europe 500, doesn’t report actual sales, only growth in percentage terms.
For the first two quarters, Next posted direct sales growth of 16.2% and store sales growth of 7.5%. Total sales for the first half also rose 10.7%.
Sales for Next are currently ahead of the 5.5% to 9.5% full-year growth guidance Next forecast in April, but the retailer is raising and narrowing its total sales guidance range for the year to 7% to 10%. Forecasting the second half is a bit trickier than usual, the retailer says.
“It might appear overly cautious to forecast a full year sales range which is below our current rate of growth,” Next said in a statement. “However, last year’s first two quarters were hampered by a particularly cold spring and Easter which presented a soft comparison for this year. Last year sales progressively improved through the year and the final quarter presents a challenging comparison. This pattern makes estimating second half sales particularly difficult, so our guidance for the next six months is for growth of between 4% and 10%.”
Mobile commerce accounted for nearly one-third of all online sales in the U.K. in the fourth quarter of 2013, according to consultancy Ecommerce Europe. In addition, about half of all visits to British e-retail sites during that period were made through a smartphone or tablet.
The 148 U.K.-based retailers ranked in the Internet Retailer 2014 Europe 500 grew their web sales an Internet Retailer-estimated 14.7% in 2013 to reach 31.04 billion euros (US $41.63 billion) compared to 27.05 billion euros (36.28 billion) a year earlier.