Roys of Wroxham eyes expansion despite profits slowing in high-cost year
PUBLISHED: 09:55 14 November 2018 | UPDATED: 15:00 14 November 2018
Archant Norfolk Photographic © 2011
One of Norfolk’s best-known retailers insists it is optimistic about the future, despite being squeezed by rising costs.
Roys of Wroxham saw turnover edge over the £51m mark, though pre-tax profit fell from over £1.3m last year to £1.08m this year.
Director Edward Roy said that operating profits at the group had been hit due to “absorbing higher cost of sales and payroll costs that were not fully passed on to the customer”, in a statement with accounts filed at Companies House.
Despite employing fewer people – 791 in selling and administration in full and part time roles, versus 812 last year – the chain has seen staff costs rise to over £10m.
The increase in staffing costs of almost £250,000 is down to wages rising from £9.2m to £9.4m, as well as social security costs rising to over £500,000. Distribution costs also rose from £10.12m to £10.44m in the last year.
Despite this, the group wrote that it is “committed to seeking new opportunities for additional stores.”
It added: “We continue to invest in the use of technology and the layout of our stores.”
The family-owned independent, which has 15 stores across East Anglia, was recently boosted by the North Norfolk District Council’s approval of its 1,672sqm eatery and terrace at its 100-year-old outlet in Hoveton.
The accounts also highlight “uncertainty over the level of demand for the company’s products” against a backdrop of weakening consumer confidence which has hit the high street hard in 2018.
Just last month, the chairman of fellow Norfolk retailer Jarrold and Son warned that cost pressures would weigh heavily on its retail division in the coming 12 months, despite reporting a “solid year” of results.
The past year has seen retailers and high-street businesses battling a perfect storm of conditions, with rents and business rates rising along with staffing and import costs.
Consumer confidence has softened while the shift to online and undercutting from web-based rivals has led to struggles for high-street stalwarts such as Debenhams and House of Fraser, while the likes of New Look and Marks and Spencer have closed stores.