The COVID-19 health crisis has given Briscoe Group the idea to sharpen its focus on developing a stronger online presence.
Rod Duke, group managing director, said that during the COVID-19 Alert Level 4 restrictions, the company was able to offer a condensed range of essential items and saw online demand double during this period.
“With New Zealand now in Level 3 we expect this to continue to grow as a result of being able to offer the full range of products available at Briscoes Homeware, Living & Giving and Rebel Sport, albeit online only,” Duke said.
The company’s digital business generates about 10 per cent of its sales which was at $97.0 million, unaudited, for the first quarter ending April 26, 2020, 35.6 per cent lower than the $150.6 million achieved for the same quarter of last year.
Prior to the lockdown, trading for the first quarter up to and including March 24, 2020 had seen group sales grow by 4.2 per cent over the equivalent days of last year, the company said in a statement.
However, the adverse impact since Level 4 commenced on March 25, 2020, has been significant, according to Briscoe.
The company announced Duke will not be taking a salary at all until at least the end of July 2020, along with the senior management team agreeing to a freeze on their salary increases for the same period.
“This week the board and senior management have decided to strengthen this commitment by agreeing to a temporary reduction in fees and salaries of 20 per cent, effective from May 2020.”
Duke said their focus continues to be on doing all they can to keep their team and customers safe.
“I’m very proud of how everyone right across the business is adapting to these unprecedented times,” he said.
“Team members who have returned to work to support the online and fulfilment operations, and support team who continue to work tirelessly from home while balancing the increased demands of home life are just two examples of how our business is rising to the challenge.”
Duke said the company is currently having ongoing discussions with landlords and suppliers in relation to agreeing equitable solutions for both trade and non-trade expenditure.
“The Government wage subsidy of $11.4 million has supported our ability to pay the team’s normal remuneration throughout Level 4,” he said. “As we enter Level 3, cost decisions such as the salary reduction initiated by senior management allow us, at this stage to continue with full pay for the rest of our team and with no redundancies incurred.”
Duke said with the uncertainty around store closures continuing, as well as the ongoing economic and social implications as a result of COVID-19, it’s difficult for them to accurately forecast the full financial impact of the health crisis on the Group at this time.
“However, the effect on first half revenue will be significant which currently is expected to result in only a modest profit to be reported for the first half,” he said.
