Bathroom firm in e-commerce drive
Wholesale Domestic on track to boost sales to £10m and hire 40 staff
A FAMILY-owned bathroom product supplier is forecasting significant growth after the success of its e-commerce operation gave it the confidence to invest £3.5 million in a major new showroom, warehouse and customer collection facility.
Hillington-based Wholesale Domestic, jointly owned by brothers Derek and Walter Toward, launched the 133,000 square foot facility shortly after Christmas. It forecasts that the investment will allow it to lift turnover to beyond £10m in its current financial year and take on a further 40 staff by the end of 2017. Its current headcount has already grown to 55 from 37 since the investment in the new premises was made.
The company sanctioned the expansion after outgrowing its 40,000 sq ft premises based nearby, which had been its home since 1990, with the rapid growth of its e-commerce operation driving the need for more storage space.
Wholesale Direct, launched by the Toward brothers’ father in 1963, is on course to lift turnover from £8.3m to £10m this year. And it has pencilled in revenue growth of 20 per cent in subsequent years as the benefits brought by the new facility, including enhanced buying power, start to filter through.
The new premises, developed in a formerly derelict building, hold around 5,000 product lines, ranging from bathroom suites to accessories and tiles, while visitors to its website can access up to 30,000 products as a result of the company’s ecommerce partnerships.
The original showroom and warehouse, however, will remain open, with the owners now mulling further investment to modernise the premises. Walter Toward said the addition of bigger premises means it has acquired “the scale needed become a national company”.
He said: “With e-commerce at the forefront, our strategy is to look after our existing customer base while making the new base into a model logistics operation that can be replicated elsewhere in the country.”
Mr Toward said the company’s foray into the online arena took off after nephew Brian Toward, son of Derek, joined the business as finance director around six years ago. He explained its expanded warehouse will allow it to continue increasing the volume of goods it sells both online and through consumer and trades people buying directly from the showroom.
Mr Toward emphasised the importance of trade customers to the business, noting it had recently introduced a loyalty scheme for trade buyers and extended morning opening hours to accommodate early visits. But he insisted Wholesale Domestic is a “retailer by heart to and always will be”, adding that it plans to introduce a next-day delivery service.
“We’re not anything else – we’re a bathroom store and nothing else,” Mr Toward said. “What we try to do is turn over [products] as quickly as we get them in to meet targets for increasingly tight margins, because of the exchange rate. So volume is king.”
Mr Toward observed that competition is increasingly tough in the bathroom sector, highlighting companies such as Victoria Plumb, Victorian Plumbing and Better Bathrooms among its rivals.
However, he pointed to Wholesale Domestic’s burgeoning e-commerce arm as a “great way forward”, saying it will allow the business to broaden its customer base beyond the central belt. The distribution of its products is handled both by its own fleet of vans as well as Palletways.
On the website, Mr Toward said: “It’s giving [consumers] a big encyclopaedia of what we do to look at before they make the journey to store, which helps immensely, even from a research point of view.
“The flip side of that is they can see everything online and compare it with everyone else’s [products] online, so we are competitive with the bigger boys in the game.”
Asked about the effects of the Brexit vote, Mr Toward said Wholesale Direct had still to feel any impact from the rising cost of imported goods which has followed the collapse in sterling.
But he said it is “going to hurt”, noting: “It’s going to have an impact but we think we can minimise the ‘pass on’ of that to our customers by being more efficient in our distribution and looking at increased activity in volume.
“Margins are reasonable but getting tighter. As long as volume keeps up hopefully we don’t need to pass that on to the consumer too much, if at all, in the near future.”