Hotel Chocolat eyes up new stores in Ilkley, Skipton, Whitby and Scarborough after sales soar in York, Beverley and Harrogate

Luxury chocolate maker Hotel Chocolat said its York, Beverley and Harrogate stores were star performers over the past year and performed “way better” than the company average.

Angus Thirlwell,co-founder andchiefexecutive of Hotel Chocolat

Sales in Yorkshire have been so strong that the group is eying up picturesque locations in the region for new stores.

Angus Thirlwell, co-founder and chief executive of Hotel Chocolat, said: “We’ve got some real high flying locations like the York Designer Outlet, Beverley and Harrogate, which we are really pleased with.”

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He said the rediscovery of local high streets amid lockdown means Hotel Chocolat is keen to open in picturesque places where it is pleasurable to live. He singled out Ilkley, Skipton, Whitby and Scarborough as prime targets, describing them as thriving residential areas.

This will be an ambition for 2021 as the firm is keen to ride out the virus before it opens any new stores.

Mr Thirlwell said city centre locations like Leeds and Sheffield were more subdued as people are not returning to their offices.

“We are seeing a very encouraging picture overall in Yorkshire,” he said.

“The footfall is in places where people can drive to. People are also rediscovering their high street. It is very encouraging for when footfall comes back.”

He made the comments about Yorkshire as the firm announced that online sales leapt by over 200 per cent in April, May and June as customers switched to web sales whilst stores were in lockdown.

The firm said that all of its UK physical locations were closed for a period of 12 weeks from March 22 to June 15. This period coincided with Easter and Mother’s Day, two of the three biggest gifting seasons for the group.

The business said it was able to migrate a significant proportion of these sales to online. It added that the team demonstrated great agility by collecting Easter inventory from over 100 retail locations, temporarily reducing the online product range, and introducing pre-selected product bundles so that its distribution centre could safely handle as much of the surge in online demand as possible.

In the year to June 28, revenue rose 3 per cent to £136m. In the first half of the year, group sales of £92m were an increase of 14 per cent year-on-year. In the second half of the year, group sales of £45m were a decline of 14 per cent year-on-year.

In addition to increased gifting sales, digital sales growth was supported by a 47 per cent year-on year increase in the sales of subscriptions and recurring purchases, including Hot Chocolat refills for its Velvetiser in-home system.

The group anticipates underlying pre-tax profit to be in line with expectations.

Since early March, the firm said it has been focused on managing both the immediate and longer-term impact of Covid-19 on the business. It added that the foremost priority throughout this period has remained the safety and wellbeing of colleagues, customers, and communities.

Some 119 of 125 UK locations are currently open for business. Sales in high street locations are performing more strongly than in city-centre commuter locations. Whilst total sales from physical locations are lower year-on-year, Hotel Chocolat said digital growth remains very strong and group-wide sales since the end of the period remain in line with management expectations.

The board said it is confident in the resilience of the brand and the potential for growth and success in the future, but it acknowledges less visibility than usual for 2021, given the uncertain severity and duration of the Covid-19 impact.

Mr Thirlwell said: “I’ve been hugely impressed by how our team have responded, culturally, professionally and ethically during the pandemic. The acceleration of change in the retail landscape has galvanised us to speed up our plans and investments in the opportunities we were already pursuing.

“Our physical retail usually accounts for over 70 per cent of sales in the second half, but all locations were closed for the entire Easter period this year and beyond. It is a testament to our lovely customers’ loyalty that they switched in droves to online and we contained the group impact to only minus 14 per cent in the half.

“Online, our brand is now set to a significantly faster growth trajectory, delivering gifts, subscriptions and household indulgence. Some of this is attributable to Covid-accelerated change, but new concept launches, and digital enhancements have also supported growth. The Velvetiser in-home drinks system, the VIP loyalty programme, and new subscriptions capability will continue to generate growth in the years ahead.”