It’s the descent into hell for the Spartoo title. Since its initial public offering (IPO), in the summer of 2021, the action of the pioneer in the sale of shoes online has fallen from 6.53 euros to 2 euros, a fall of … 68%. If Boris Saragaglia, the co-founder and CEO of Spartoo, refuses, like many leaders, to comment on the evolution of the stock market, he notes however that many players in retail, consumption and e- trade are heckled in the financial markets. Investors are wondering about the consequences of inflation on household consumption and on stocks and supplies, while Beijing’s zero-Covid policy leads to confinements and a slowdown in activity in China. ” We have had delivery delays but we have been anticipating for 18 months and our stocks are at their highest on timeless products (+25% more stock compared to 2021 over the same period) “, underlines the leader. If international brands require their customers to place an order as soon as possible, for city brands and own brands, Spartoo favors short circuits, such as Europe (Italy, Spain, Portugal) and North Africa (Tunisia, Morocco), which limits supply problems.
” We have suffered above all from the evolution of consumption and the destabilization of households linked to the 300,00 daily positive cases in January “, confesses Boris Saragaglia. The winter sales, from January 12 to February 8, took place against a backdrop of an epidemic rebound in France. Customers had little morale and even less desire to buy shoes. In March, the influence of the weather was decisive. However, it was cold, which hampered demand. ” Since the end of April, it has started again linked to change” time, notes the co-founder, who wants to believe that “ what was not spent in April will be spent in May “. The return of the sun is also helping to boost household morale. What about inflation? Among CSPs -, the surge in consumer prices is leading to trade-offs between essential expenditure (food, housing, transport) and so-called discretionary expenditure, such as leisure or clothing. This category is not the target of Spartoo, which is targeting CSP+. The latter are less likely to dwell on labels… for now.
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Eager to boost its notoriety, the Grenoble group has invested, in accordance with the plan presented during the IPO, between 2 and 3 million euros net and clubbed, from the month of January, in anticipation of the sales, its new television advertising spot . His slogan : ” Look no more everywhere, go to Spartoo “. But the return on investment is not satisfactory! ” On the 10-minute additional visits indicator, performance was not good in January due to the health crisis and high spot densityrecognizes Boris Saragaglia. Costs per visit are higher than expected. Internally, the teams are mobilized to analyze this “failure” and draw lessons from this expense which will inevitably weigh on the gross operating surplus margin. In 2021, this margin has already slipped by 1 point, to 3.7%. The quest for notoriety remains no less strategic for Spartoo, which continues to communicate on the radio and on social networks.
Inflation also affects paper pulp and plastic, and therefore packaging. In this regard, Spartoo’s strategy is twofold. ” The big international brands pass the inflation on to us, which we in turn pass on to the customer, explains the co-founder. For own brands, we do not pass on inflation because our objective remains to increase our margins by increasing sales volumes and not prices. Either way, it’s a marginal cost. The pace of store openings is also below expectations. ” If we open three, it will be good “, admits the management, which has set itself a target of five new brands per year. ” Rents are too expensive. In the medium term, the management nevertheless confirms its objectives announced at the time of the IPO, namely an average annual growth of more than 10% and a gross operating surplus margin (Ebitda) of 7% even if the quarter was harder than expected.
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