Home shopping giant N Brown posted a like-for-like sales uplift of 8.8% in the 19 weeks to January 10, boosted by strong demand across all product categories.
However, N Brown said that gross margin fell by 1.5% over the period, due to an increase in the charge for bad debts. The group said 0.7% of this was due to the planned higher proportion of sales from younger customers, which are higher risk.
N Brown said the remainder of the bad debt increase was due to a significant decline in the rates on offer from third party debt collectors for residual debtors. It expects this to continue until the end of the economic downturn.
N Brown chief executive Alan White put strong sales down to the company’s unique proposition: “The average age of our customer is 57, and they are more resiliant in the current climate. We are also a size specialist, and our product USP’s are not affected so much by discounting on the high street. Our website’s have also been getting better and better. I am looking to grow in 2009, but at a more modest level this year.”
Separately, online sales at N Brown soared 34% over the period, and now account for 35% of total sales.
N Brown said sales from new customers were level with last year, in line with its revised marketing budget for customer recruitment.
The company expects full year sales to be in line with expectations.
The group plans to launch its Simply Be plus-size brand in Germany next month, with an investment of £1 million.