Following today’s release of Lakeland’s figures for the year ending 31st December 2023; Oliver Maddison, retail analyst at GlobalData, a leading data and analytics company, offers his view: “Lakeland disappointed in 2023, with an underperformance in H2 due to its failure to shift its emphasis from electricals to its cooking and baking range, driving its revenues for the year to fall by 0.6% and contributing to an operating loss of £1.8m. This represents an underperformance relative to the overall kitchen & dining market, which grew by 1.5% in 2023, according to GlobalData, and shows it to have been outclassed by rival ProCook, who managed to grow sales by 0.4% in its full year to 31 March 2024, while delivering an underlying operating profit of £2.1m.
“Whilst Lakeland’s Smart Spend campaign, which promoted energy-saving electricals such as air fryers and heated airers, proved successful in H1 as consumers sought to save money on energy costs, it failed to achieve the same cut-through in H2. The retailer highlighted a heatwave and the receding energy crisis in Q3, alongside consumers opting for an austere Christmas, limiting its sales of Christmas decorations in Q4 as reasons for its difficulties. This doesn’t cut the mustard, however, but speaks to its Smart Spend campaign’s focus on energy-saving electricals at the detriment of its cookware offering, as well as consumers focusing on low prices as they switched to discounters. ProCook’s golden quarter sales growth of 3.0% demonstrates that cookware was in demand during the period, as consumers prioritised preparing food for Christmas Day over decorating their homes as they hosted meals at home instead of eating out.
“Despite its poor performance relative to competitors, Lakeland still has the potential to do well in its core cooking & baking sector, a fact recognised by John Lewis’ inclusion of Lakeland in its renewed Never Knowingly Undersold price matching pledge. To realise this potential, it must emphasise its cookware range as a means of saving money while consumers continue to get back on their feet in the wake of the shocks to their living standards. Once consumers begin to feel the benefits of their wages once again outpacing inflation, it can subsequently emphasise both the quality and convenience of its product range to retain these customers.”
