Carpetright appoints advisers on cost cutting

One of the UK's largest carpet retailers, Carpetright, has appointed advisers, Teneo, to look at ways of reducing costs. Carpetright has recently experienced a downturn in sales.

Following Teneo's examination of the business, there could be closures of unprofitable shops and rent reduction negotiations.

In a 14-month period up to January 2022, the company had revenues of £372.6 million, down from £493.2 million the previous year. Carpetright lost £23.4 million pre-tax during the period to January 2022, which was less than the previous loss of £53 million.

Most Carpetright shop locations have several competitors close by. Martin Harris, the son of Lord Harris of Peckham, Carpetright's founder, has opened rival carpet shops close to many of Carpetright's stores.

Carpetright's longstanding business model has been to heavily discount carpet prices and offer money off larger orders. There has been less demand for high value premium quality carpets, which is one reason for the drop in the company's sales.

While at first customers may be under the impression they can find bargains at Carpetright, shoppers who compare prices can often find that the same quality carpets can be found at a similar or cheaper price at a local independent carpet retailer. Many prefer shopping at an independent carpet retailer in Chester or North Wales as they feel they get better customer service.

Though some consumers choose hard flooring rather than carpets, there is still a large demand for traditional carpets that add luxury and warmth to a room.