Beter Bed presented a mixed picture in 2017. Just as in 2016, performance varied sharply from country to country, with lower revenue in particularly the German-speaking countries. This stands in sharp contrast to the higher revenues once again achieved in the Benelux.
The group as a whole realised higher revenue with slightly decreasing margins and higher expenses, which resulted in lower operating profit in 2017 compared to the previous year.
The success of Beter Bed in the Benelux and Beddenreus in the Netherlands continued unabated in the year under review. Revenues and margins improved and the focus on retail marketing, with customer satisfaction as the spearhead, continued to bear fruit.
This is due both to successful realisation of the 'From Good to Great' strategy and continuing favourable macroeconomic developments. There also continues to be high demand on the housing market, a high level of consumer confidence and high propensity to buy.
Matratzen Concord in Germany was able to largely reverse the negative trend of a decreasing number of visitors in the first six months of 2017. This trend could not, however, be sustained in the second six months of 2017, with mainly supplier-related problems in the sector and the related media attention leading to a sharp decrease in the number of visitors in the fourth quarter. The latter was primarily the case in October and November, which is in line with the experiences in the market. Matratzen Concord saw the number of visitors recover in December.
Matratzen Concord Austria posted lower revenue in 2017 after benefiting in 2016 from the increase in the number of stores owing to the acquisition of BettenMax. In contrast, Matratzen Concord Switzerland benefited from the weak comparative basis from 2016 when changes to the exchange rate negatively affected average consumers’ buying power. Both formats were impacted by the same supplier-related problems as their German counterpart in the fourth quarter of 2017.
El Gigante del Colchón in Spain continued to achieve growth and higher revenue. Sängjätten in Sweden benefited from the successful introduction of the group's (private label) brand portfolio, which has already been successful in the Benelux for a number of years. In the course of 2017 it became clear that it was unlikely that Literie Concorde in France could be operated on a sufficiently profitable basis in the short to medium term. It was consequently decided to discontinue the activities of this format.
Margins on goods decreased slightly at the group level in 2017 due primarily to the increasing share of box springs and textiles in the revenue. This decrease could be compensated partially by improvements in the terms and conditions and changes to the range. Product innovation and the implementation of price increases also had a positive effect on margins.
Expenses rose in the Benelux primarily due to the further expansion of the omnichannel and customer satisfaction activities and heightened logistics activities as a result of the substantial increase in revenue. In Germany, the further professionalisation of the organisation (connected with the reorganisation expenses) in general and the expansion of the omnichannel organisation in particular led to higher expenses. The marketing activities were also increased and the amortisation costs rose due to the renovation of the stores in Germany.
Economic developments in the countries in which Beter Bed Holding operates remain favourable for 2018. We are consequently optimistic for the Benelux due to the numerous positive developments in 2017 and the plans and initiatives for 2018. Matratzen Concord will start with a new management in 2018. In addition, the majority of the stores has been refurbished and the introduction of box springs has been finalised. Furthermore the new web shop platform has been implemented and a new and expanded marketing campaign has been launched, which will enable Matratzen Concord to once again attract consumers to its stores and web shops.
Beter Bed Holding continues to pursue in full the objectives set out in the strategic plan ‘From Good to Great 2016-2020’, with the primary focus remaining on maximising customer satisfaction within an omnichannel environment. A reassessment of the CSR objectives was carried out within the parameters of the strategy in 2017.
CEO Ton Anbeek announced on 14 July 2017 that he would be leaving Beter Bed Holding to continue his career elsewhere. He stepped down as CEO on 31 October 2017, bringing to an end a seven-year period in which he worked on building the success of Beter Bed Holding with outstanding dedication and commitment. The arrival of our new CEO, John Kruijssen, on 1 April 2018 means our Management Board is once again complete and that we can together work on further developing the group.
Despite the difficult circumstances in Germany, the company succeeded in 2017 in making progress on further developing the organisation and strengthening its position in the different markets. We are extremely grateful to our employees for the contribution they have made both individually and as part of a team.
Uden, The Netherlands, 1 March 2018