bonprix achieved its target of double-digit sales growth in the 2021/22 financial year (1st of March 2021 to 28th February 2022): The international fashion company increased its sales revenues by 10 percent from 1.76 billion euros to 1.94 billion euros with a stable return (EBIT margin) and has been thus growing profitably for the 13th year in a row. Germany as the core market closed strongly with a double-digit increase in sales compared to the previous year, while many Eastern European and Scandinavian bonprix countries also showed excellent growth. In the USA, the company achieved a successful turnaround with the VENUS brand.
“The business development and the double-digit increase in turnover of around 10 percent compared to the previous year are a great achivement for us. We have succeeded very well in exploring new market opportunities in the countries due to accelerated digitalization, gaining new customers in many markets and thus further developing ourselves as an international digital fashion brand,” says Dr. Kai Heck, as Managing Director responsible for finance at bonprix, commenting on the very positive business performance.
International business performance
At the end of the 2021/22 financial year, the overall picture for bonprix in Germany and abroad is very satisfactory:
Germany as the home and core market was able to build on the highly pleasing development from the first half of the financial year. By the end of the financial year, sales had risen by around 10 percent year-on-year to just under 750 million euros. More than 5 million active customers in Germany order fashion and more from the Hamburg-based company.
In many Eastern European markets, the excellent results of the first six months of the financial year also continued. Particularly noteworthy are the Czech Republic, Hungary and Slovakia with growth rates in the higher double-digit range (well over 20 percent), Poland and Romania also achieved double-digit growth.
In Western Europe, sales in the Netherlands increased by more than 10 per cent. Other high-turnover focus countries such as France and Austria were just above the previous year, while Italy and Switzerland were unable to match the previous year's figures.
The Scandinavian countries Sweden, Norway and – new since 2021 – Finland, continued to develop very positively and achieved growth rates in the high single and medium double-digit range. With the Finnish market, bonprix was able to complete its business portfolio in Scandinavia and spread synergy effects among the three countries – this is also shown by the positive reaction of Finnish customers to the new provider bonprix.
The performance of the VENUS brand in the USA continued to be particularly pleasing. Here, bonprix achieved a turnaround in the first half of the 2021/22 financial year following ongoing challenges due to a difficult market environment and exchange rate burdens. The highly positive growth continued and led to a closing of almost 20 percent plus compared to the previous year.
Termination of the e-commerce business in Russia
In Russia, the weak business development of the previous years continued and bonprix recorded a loss in sales of more than 30 percent in the financial year to only a mid-double-digit million amount. Following a necessary reassessment of the future viability of its retail business there, the bonprix brand is withdrawing from the Russian market. The political and economic conditions are depriving the company of the basis for an economic business model in Russia. At the beginning of March, bonprix had already decided to discontinue its online retail business in Russia.
“The decision to end our long-standing e-commerce business in Russia was not easy for us, but we no longer see any prospects for our company in the country. I would like to thank our colleagues in Russia and Germany for their great commitment over the past years,” says Dr. Richard Gottwald, CEO of bonprix and responsible for international sales. The company is now focusing on developing socially acceptable solutions for the employees affected and, where possible, on examining internal opportunities in the Otto Group.
Strong assortment growth in central segments
On the assortment side, demand in the individual segments was still strongly influenced by the coronavirus pandemic in the 2021/22 business year. In women’s wear, the casualization trend continued: shirts and denim items in particular recorded above-average growth. The dresses segment, which makes up a central position in the bonprix range, had seen a decline under the pandemic. After social occasions increased again, there were pleasing signs of recovery here, especially towards the end of the financial year. The lingerie segment owed further growth on a very high prior-year basis, driven in particular by nightwear and loungewear, to the continuing high demand for products related to personal well-being as well as a broad-based, national media campaign in autumn 2021. The sports segment also benefited from this development and achieved additional growth on a high template. The children's range also grew significantly once again, outperforming the market.?
Sustainably produced products continue to be of growing relevance in the bonprix range. Last autumn/winter, the company reached a new milestone with a high proportion of 80 percent of sustainable materials for the styles in the women's collection1 and is also presenting undyed fashion for the first time in the new financial year in the current spring/summer collection, which protects valuable water resources.
Further development of the bonprix digital fashion brand
In the 2021/22 financial year, bonprix placed a central strategic focus on further sharpening its profile as a digital fashion brand and driving customer loyalty via digital channels. The basis for this is the user-related personalization of the web shop and the further development of the content and internationalization of the bonprix app combined with investments in high-reach app installation campaigns. In addition, the company focused on the expansion of its social media activities and numerous live shopping events in which fashion influencers bring bonprix's key styles to life for customers with a high entertainment factor.
Outlook for the 2022/23 financial year
“The 2021/22 financial year was one of the strongest in bonprix's history and we are very pleased with the successful conclusion,” states Richard Gottwald, commenting on the gratifying business development. In the current financial year, against the backdrop of challenging conditions for global trade, bonprix will have to meet new demands such as price increases in procurement and subdued consumer sentiment. Gottwald concludes: “The financial year is challenging, but I believe we are well positioned for the still extremely volatile market situation. Our goal in the challenging financial year 2022/23 is to drive forward our strategic issues and continue to work ambitiously and with high quality in the direction of our customers.”