Bedroom, living and dining furniture supplier Serene has reported higher turnover yet lower profits across its last financial year, principally driven by expansion costs.
“Turnover is up 8.375% year on year, which is an impressive rise when you consider that turnover for the previous financial year was also up 15.4%," comments MD Tasleem Tasab.
"However, like-for-like profitability is down and there are some very good reasons for this, the main one being expansion. We have added a further 100,000 sqft of warehouse space to the business, which in turn required racking, forklifts, IT and people – we invested heavily in staff recruitment, training and development and also software to ensure the smooth, efficient running of all aspects of the newly-expanded operation.
"Product development was also a major cost, as Serene embarked on the first phase of an ambitious five-year plan to launch and grow market share in new areas of the home furnishing market – the launch of Serene Living’s recliner and dining collections the first part of this plan.
"Unfortunately, bad debt also played a part, with a number of retailers going into administration. We are regarded as one of the key importers/wholesalers of bedsteads in the UK and we want to use the infrastructure and skillsets that have been put in place during the last financial year to allow Serene to further grow its product range and market share within the furniture industry.”
