Furniture sales site Miliboo maintains its course despite inflation – Le Journal des Entreprises
Despite soaring prices in 2022, 6% on annual average according to INSEE, which weighed on the purchasing power of the French, the online furniture brand Miliboo (100 employees), continued to attract consumers. The Savoyard company, based in Chavanod, thus posted a 16% increase in its turnover, to 21.4 million euros over the period from 1er May to October 31, 2022. Growth mainly linked to the increase in sales volumes, the price effect having been marginal, according to Guillaume Lachenal, CEO and founder of the Savoyard company, listed on the stock market since 2015.
“We took care during this difficult period to maintain a good turnover rate of our stocks and to maintain a strong marketing presence. This enabled us to win new customers and achieve a record level of activity over the half-year”, sums up so the boss.
Miliboo notably boosted its notoriety by signing a strategic partnership three years ago with M6, which allowed it to benefit from significant advertising space on all of the French channel’s media (moreover entry into the capital of Miliboo for 21.4% in the summer of 2022). His phygital distribution model (physical and digital)with a platform offering more than 2,500 references and the presence of three physical points of sale, one in Lyon and two in Paris, also helped it stay on course in 2022.
Very high cost prices
The good resistance of its sales was nevertheless not enough to offset the surge in the cost of Miliboo, whose EBITDA was negative in the first half of 2022 (-1.3 million euros). Several factors weighed on margins, starting with a negative euro-dollar exchange rate effect: “The dollar rose by 20% against the euro in one year; however, we buy our products in dollars”, explains Guillaume Lachenal, who specifies that 85% of Miliboo’s production is carried out abroad, including more than 50% in China.
The five-fold increase in the price of containers between China and the Old Continent last year also penalized the importing company, as did the soaring cost of raw materials and the saturation of Asian ports and factories.
All of this led to a rise in cost prices that Miliboo only partially passed on to the price of its end products. The average basket thus increased by 5% compared to the first half of 2021. “Everyone had to readjust their prices to cope with the inflationary context, and those who took too long to do so collapsed”, explains Guillaume Lachenal again. . In November 2022, the online furniture seller Made.com announced its placement in administration with a view to its liquidation and the suspension of its action on the London Stock Exchange. Another victim of the inflationary crisis, the specialist in the online sale of garden and landscaping products Oogarden, based in Ain, placed in receivership at the end of 2022.
A gradual restoration of the margin rate
If the Banque de France and INSEE are counting on a peak in annual inflation this first quarter of 2023, the CEO of Miliboo remains confident about the prospects for his company. “We feel like we’ve weathered the storm, costs are tending to rationalize. Container costs are coming down even though we know we won’t be going back to the prices of two years ago in the immediately”, explains Guillaume Lachenal. In addition, according to him, it is now easier to renegotiate certain prices with producers.
In this still fragile economic context, the Savoyard company intends above all strengthen its market share in the countries where it is already present, and in particular in Spain, Germany and Italy. “In a furniture sector that is now concentrated around the strongest players, we clearly have a card to play over the coming semesters. There is a real opportunity to continue to develop our active customer base and strengthen our position. as a specialist player recognized in Europe”, says the manager.
And if no pre-established calendar is fixed for the opening of a next point of sale, the CEO says to remain in an opportunistic approach in order to keep as many doors open for the development of his activity. “We are still in the construction phase of the Miliboo brand, we need to find beautiful places in strategic locations”, specifies the manager.