Luxury leathergoods company, Aspinal of London, has managed to maintain a positive outlook despite experiencing a decline in sales due to the Covid-19 pandemic. According to its full-year accounts, which covered the period until March of last year, the company witnessed a 31% decrease in sales revenue, falling to £23.1 million. Adjusted EBITDA also decreased from £5.8 million to £3.4 million. However, the company saw a net profit increase to £4.3 million, bouncing back from a loss of £10.1 million in the previous year. Additionally, the gross margin saw an uplift of 8%.

In response to the challenges posed by the pandemic, Aspinal of London made a strategic decision to shift its focus from physical retail to online operations. By closing most of its stores and only keeping its flagship locations in Regent Street, Royal Exchange, Harrods, and Selfridges open, the company aimed to streamline its resources and adapt to changing consumer behavior. Furthermore, Aspinal of London recognized the significance of the Chinese market in the luxury goods industry and expanded its market presence by opening its first franchise store in China.

To further address the challenges, the company implemented cost-saving measures and entered into a company voluntary arrangement in October 2020. This allowed them to close underperforming stores and negotiate turnover-based rents for the remaining locations. These efforts were successful in transforming Aspinal of London into a profitable and cash-generative online business.

Despite the difficult circumstances faced by the luxury sector due to the pandemic, Aspinal of London’s online operations continued to thrive, achieving significant double-digit growth in e-sales. With 85% of the business now conducted online, the company remains optimistic about its future prospects. In fact, it stated that the transformation into a profitable online enterprise has been successfully completed. Based on its current performance, Aspinal of London believes that it is on track to experience substantial growth in EBITDA for the fiscal year 2022. Notably, direct retail sales for the first six months of the new financial year were 29% higher than the previous year on a like-for-like basis.

The ability of Aspinal of London to adapt and thrive in challenging circumstances is a testament to its resilience and determination. By embracing the digital realm, the company has positioned itself for long-term success in the ever-evolving luxury goods market. With a continued focus on online operations and the ongoing growth of e-sales, Aspinal of London remains confident in its ability to navigate uncertainties and maintain its position as a leading luxury leathergoods brand.

Useful links:
Aspinal of London Official Website
Forbes – COVID Triggered Virtual Shopping Boom Shows New Strength of Luxury Segment