CEO Matt Davies outlined “Get into Gear 2016” a five-point, three-year strategy designed to improve its services, upgrade its store estate, reassert its “authority” in the car and bike market and create a “service-led digital proposition”.
The move follows a year-long review of the business, during which Halfords has focused on improving its service offers such as its Wefit car and bike maintenance propositions.
Halfords will also extend the community services it offers following a trial of a series of Kids Bikes Workshops designed to teach children basic bike maintenance skills and “create a new generation of Halfords customers”.
The chain hopes the strategy will help increase annual sales to£1bn by 2016. Total revenue for the year ending 29 March was £871.3m.
Revenue from its retail division was down 0.9 per cent. Revenue from Halfords’ Autocentres division, however, increased 13.5 per cent. Total sales were up 1 per cent year on year.
Online revenues grew 15.9 per cent and account for 10.3 per cent of sales following investment in website capability and the launch of a new search engine and reserve and collect service, the retailer added.
Bike sales were down 0.6 per cent on a like for like basis during the year but the chain claims the Olympics and Paralympics helped drive interest in cycling in the second half, particularly its Pendleton bike range fronted by Team GB Gold medalist Victoria Pendleton.
The chain hopes to capitalise on the upsurge in interest in cycling following the Olympics by making this year what it calls “The Year of the Cycle” with a number of new bike models and relaunches and a partnership with Sky’s Sky Rides scheme.
The chain appointed David Durie as marketing director last December as part of a restructure of its management team which also included the appointment of former Walmart chief marketing officer Emma Fox as commercial director.
Halfords also appointed Mother to handle its £12m advertising account in February as part of its efforts to overhaul its communications and transform itself into a “provider of expert help and services”.
Retail marketing agency Gratterpalm was also appointed to work on the retailer’s in-store marketing and communications.
Davies says: “Halfords Retail sales performance in FY13 reflected a demanding trading environment and demonstrated how we can exploit our offer with investment and by focusing on areas of opportunity … The fall in group profitability however illustrates the pressing need for sustainable revenue growth to offset ongoing cost inflation.
“[Getting into gear 2016] will focus on supporting our colleagues to deliver consistent friendly expertise backed by major improvements in store environments, plus building on the authority of our offer, infrastructure and digital capabilities. We expect these vital investments will inevitably reduce short-term retail profitability but will deliver long-term revenue and profit growth together with sustainable shareholder value.”