Good first half-year for bonprix: successful business performance underpins positive full-year forecast

The international fashion company bonprix recorded encouraging development in its markets in the first half [1] of the current 2019/20 financial year and was able to increase its real turnover by 11.7 per cent despite the challenging integration of the Russia Group [2] and the demanding US business. On a comparable basis [3], the Otto Group company grew by 3.3 per cent in terms of turnover and is thus on track. The Eastern European markets, including Poland and Czechia, as well as the Netherlands and Austria, showed particularly strong double-digit growth rates. Domestic business in Germany also developed positively. Here, the fashion brand increased its sales by almost 4 per cent compared to the previous year and, with its online shop bonprix.de, maintains its position as the number two web shop in terms of sales in the fashion sector [4]. In addition to these encouraging first six months of the financial year, bonprix's very good results in September also reinforce the positive forecast for the year as a whole.

‘We are extremely satisfied with developments in Germany and Europe and are looking ahead to the coming months with great confidence,’ said Dr Kai Heck, bonprix's managing director responsible for finance, commenting on the half-year figures. ‘We owe the very good growth rates in many of our markets in particular to our adaptable market and product strategies and our excellent inventory management.’ bonprix's mobile-first strategy also continues to pay off: internationally, the fashion company is recording a 25 per cent increase in demand via its app and mobile online shops compared to the same period last year.

In the USA, bonprix is only slightly up on the previous year. To boost growth, the fashion retailer is increasing its investment in digital marketing measures for its VENUS brand there and is also focusing on market-typical cost sharing for shipping and returns. bonprix considers itself well positioned for the Russian market with the establishment of a cross-border marketing and sales team in Hamburg and Moscow. ‘We continue to meet the challenges of the Russian and US markets with expertise and great commitment, because despite their complexity, both hold enormous potential,’ confirms Dr Richard Gottwald, Chairman of the Management Board and also responsible for international sales. The Russian business, which was previously reported by Otto Group Russia, was integrated into the bonprix Group at the beginning of the current 2019/20 financial year. This has not only increased the trading company's actual sales volume, but also the number of employees, which now stands at around 3,900 worldwide. bonprix is taking over all business activities of Otto Group Russia (OGR), including responsibility for the warehouse in the Russian city of Tver.

The company is currently represented in 30 countries worldwide, and its portfolio will continue to grow in early 2020: With its previously announced Spanish web shop, bonprix aims to secure relevant market shares among Spanish customers, who are strongly fashion-oriented. The success of bonprix's internationalisation strategy is demonstrated, among other things, by its cooperation with Lascana, another Otto Group company. Since this summer, bonprix has been marketing the lingerie and swimwear supplier with a web shop in Italy. This sales model is also set to be rolled out in other European countries in the future.

bonprix also remains on track in terms of innovation and is investing in promising developments in all areas of the company, such as within its CR strategy with the recently announced new target of using 70 per cent sustainable fibres in all textile ranges by 2025. As part of its new retail concept ‘fashion connect’, bonprix is now focusing more on regional marketing measures following the launch and technological stabilisation phase in order to make the store in Hamburg's Mönckebergstraße even better known among customers. At the same time, the approach of combining online and offline into a new kind of digitally assisted shopping experience will be further developed in the coming months in order to exploit multichannel potential more effectively, for example through retargeting strategies.

bonprix expects returns and sales to continue to develop positively in the current 2019/20 financial year. Dr Richard Gottwald believes that the coming months will be challenging, but he is optimistic about the future: ‘The retail sector is undergoing major changes. Many traditional textile suppliers are having to adapt to changing consumer behaviour and competition, particularly from Asia. As a vertical fashion brand, bonprix has already taken decisive steps in recent years to ensure its long-term international success.’

[1] 1 March 2019 to 31 August 2019. (For all Otto Group companies, the end of the financial year was harmonised to the consolidated financial statement date of 28 February from the 2017/18 financial year onwards.)

[2] The bonprix Russia business, which was previously reported by Otto Group Russia, has been included in the financial statements of bonprix Handelsgesellschaft since the 2019/20 financial year.

[3] Excluding the Russian business compared to the first half of 2018/19.

[4] Source: Study ‘E-Commerce Market Germany 2019’ by EHI Retail Institute/Statista. The ranking is based on sales figures.