nline furniture retailer Made.com has issued a dire warning over trading in the home furnishings market and announced a strategic overhaul of its business including potential lay-offs across the group.
The London-based company set up by Lastminute.com founder Brent Hoberman and entrepreneur Ning Li that has a large following among urban professionals said its sales for the first half of the year 2022 were down 19% compared to last year.
Shares in the platform crashed by 40% in early trading to 23.34 pence on the revelation this morning.
The business also said that profit this year was expected to be adversely impacted by £20 million due to costs “primarily in two areas”.
They were “additional promotional and clearance activity” related to excess inventory in the business, following an inventory increase and additional costs in the supply chain due to disruptions at ports and extra handling at warehouses caused by the macroeconomic environment.
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It said it was now examining employee headcount, forward stock buying, warehousing and sourcing markets, and reviewing its operational structure.
The business added that it had been hit by “worsening of consumer confidence” that had “impacted demand for discretionary big-ticket items”.
Made said it was now issuing “revised guidance” as it had also seen a 5% drop off in active customers.
Nicola Thompson, CEO of Made, said: ”It’s clear that things are tough for consumers at the moment. Understandably, we’ve seen a worsening in consumer confidence since May and this has had an impact on this period’s performance.
“As such it’s prudent for us to take a conservative view of what we can expect in the second half of this year.
“To enable us to continue executing on our strategy we’re taking steps to address the non-strategic costs in the business, as well as considering options to allow us to strengthen the balance sheet sufficiently to navigate what will undoubtedly continue to be challenging conditions. We’re confident that this will put us in a strong position for the coming years.”
The retailer stated that despite the “volatile macro backdrop”, the group has made strong progress on its strategy around experience, choice, reach and sustainability during the first half of the year.
