GrandVision is enjoying a recovery in sales as its stores reopen, but the company has noted that consumers are continuing with e-commerce purchases, especially for contact lenses.
GrandVision reported that in the first week of June, sales at its fully reopened stores totalled 87 percent of those booked the previous year, representing a 13 percent decline. The overall decline for the optical retailer’s network was 20 percent, marking a sharp improvement from April and May.
As of May 30, about 4,700 stores were fully operational, 80 percent of the fleet, including most of GrandVision’s business in Europe.
In April, about 60 percent of GrandVision’s stores were closed and the remaining 40 percent were partially open but affected by restrictions due to the Covid-19 pandemic. Sales were down by more than 80 percent year-on-year in April but improved in May, when the decline was about 55 percent.
During May, most of the company’s European markets started to reopen. It says that a “particularly strong recovery” is currently underway in the Benelux, Germany, Austria, Switzerland and across most of the Nordics. In these markets, it claims to be on track to reach prior levels as lower store traffic is compensated by higher customer conversion. It also expects a catch-up effect after several weeks of store closures.
In Latin America, where countries have been impacted by the pandemic a few weeks after Europe and North America, stores in most markets remain either closed or are operating with limited opening hours. The openingof stores across Latin America is also expected to lag behind other markets, it points out.
GrandVision adds that customers have shown great loyalty to its banners, with a significant portion of traffic coming through its customer relationship management channels.
In the first five months of the year, e-commerce sales grew by more than 80 percent, driven by GrandVision’s banner websites, which rose by almost 190 percent, thanks to “sustained investments” in digital capabilities.
The company is observing changes in customer behavior. Even with the reopening of stores, e-commerce sales are staying at high levels as clients switched sales channels, particularly for contact lenses. GrandVision is also benefiting from strong growth in online appointment bookings. To capitalize on the phenomenon, it further expanded its prescription glass e-commerce capabilities, which are now available through 12 banners in eight countries, including Germany, France, Poland, Switzerland, Finland, and three more markets are scheduled to come on stream in the coming months.
With the recovery in sales, GrandVision has taken measures to enable full operation levels of its stores where possible. This includes staffing, marketing and tech center operations as well as investing at its regular capital expenditure level of approximately 4-6 percent of annual sales.
However, due to the ongoing uncertainty surrounding the evolution of the pandemic, the company continues to refrain from issuing a full-year guidance.
As of May 31, GrandVision had a net debt of €842 million, compared with €755 million at the end of March. It remains confident in its ability to retain liquidity and secure additional funding, also in the event of a prolonged duration of the pandemic’s impact. It also reiterated its support EssilorLuxottica’s plans to buy a 76.72 percent in its capital from Hal Holding within 12 to 24 months of the announcement of the deal on July 31, 2019.