With Nisbets once again smashing its turnover records, the catering equipment reseller behemoth keeps on leading the way in online sales of catering equipment for the UK, as we look at a cross-section of web dealers as part of Catering Insight’s Power Players 2019 special report.
While the Bristol-based company does have more than 30 bricks and mortar stores dotted across the country, it’s the firm’s ‘clicks’ division that brings in the lion’s share of its sales. By far and away the market leader for catering equipment resale in the UK, in the 12 months to 31 December 2018, Nisbets garnered a record £398.1m, 5% up on 2017’s £380.3m, but the latter figure was 18% higher than the previous year’s total, which in itself was a record result at that time. However, operating profit slid from £37.8m to £28.1m in 2018, a 26% drop.
Nisbets chief financial officer Stephen Marshall stated in the firm’s latest annual report: “The group experienced challenging trading conditions as both business and consumer confidence were impacted by the ongoing political and macroeconomic uncertainty associated with the continuing Brexit negotiations.
“Management envisage that these difficult trading conditions will persist until the outcome of the Brexit negotiations becomes clearer. The business continues to take all reasonable steps to ensure it is well-positioned to trade through this period with the minimum of disruption to customers.”
Marshall added: “The group continued to focus on helping drive value for its customers during this period of Brexit-related uncertainty through competitively-priced products and great customer service. Gross margin improved by 0.7% to 37.1% as the group benefitted from better market and product mix.”
Though there seems to be a whole raft of other online-based dealers in the UK, there is a vast gulf between the top earners and the rest of the market. After exhaustive research through the Companies House website, almost all the other big web dealers have elected not to publish their full financial results, with well-known names such as Catering Appliance Superstore, Fridge Freezer Direct, G&M Supplies, CS Catering Equipment and Cater-Kwik enacting the small company abridged accounts clause, though the latter did reveal its figures for a couple of years, so we can say that in 2016 it generated £13.8m revenue.
The one exception to the above is Alliance Disposables, trading as Alliance Online. Its 2018 report shows that it is no slouch in the sector, posting £114.6m in the year ending 30 September 2018. This marked a slight decrease of 2.4% from the previous year’s £117.4m, but that total was a record.
Alliance’s operating profit slid nearly 7% to £6.4m from 2017’s 6.8m. However, its margins performed as budgeted at 28.3%, 1.5% up on the previous year’s 26.8%.
At the time of the report’s publication, director Paul Bonson reviewed: “Following a year of assessing our national account platforms, the directors are pleased with the re-shaped business model and the balance between national and regional trading.
“We ended a long-term agreement with our largest contract and since then we have enjoyed significant account gains and an over-performing regional platform.”
Bonson further analysed: “Focused efforts on costs and margins have ensured that profits have remained at a planned and healthy level during this transition. Confident of the underlying growth prospects for the company, the directors continue to invest in the systems and infrastructure of the business to deliver growth.”
He predicted: “We are forecasting further top line growth in the current financial period and focus on margin management to protect the profitability of the business. Year to date results are ahead of forecast.”
Therefore it looks like the online channel will continue to fly high, no matter how much more traditional dealers may resent it.
Power Players 2019 is sponsored by Turbochef. To visit the company’s website, click HERE.