After doubling in size over the last five years, growth has stalled at Majestic Commercial, figures released today show, with the high-street retailer’s on-trade arm the weakest-performing area of the business.
Half-year results for the six months to the end of September showed that sales at Naked Wines and Lay & Wheeler (both owned by Majestic) were up by nearly 27% and 28% respectively, while Majestic Retail was up almost 6%.
Majestic Commercial, by contrast, grew only 1.2% over the same period
According to the group's commercial managing director, Ben Nicholl, the group has been a victim of its own success – expanding so rapidly that it lacked the infrastructure and systems to support its growth.
'We've got products that our customers want,' he said. 'Customers like our proposition and all the foundations are there. But we've grown very quickly, and there are systems and procedures that need to be changed. We need to focus on the logistics. As we've expanded the range it's become more problematic to get the stock into the right place.'
Nicholl admits that he expects Commercial’s business to be flat in 2017, while new logistical infrastructure is implemented and bedded in, though the group hopes to return to double-digit growth in 2018.
The range of wines, too, will continue to be overhauled.
'There are some gaps and some products that we want to change,' said Nicholl, citing Eastern Europe and Italy as areas ripe for additions. 'We will continue to increase the range that we’ve got.'
In the Sommelier Wine Awards, Majestic Commercial won House Wine Merchant of the Year in 2014 and Great Value Wine Merchant of the Year in 2013 and 2015.