Home and speciality goods segment’s net sales- €1,569m
Home and speciality goods trade segment's operating profit excluding non-recurring items- €66.0m
Development in 2010
- 0.7%
Growth in 2010
- €36.5m
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Divisions Home and speciality goods trade
Home and speciality goods trade
The home and speciality goods trade comprises Anttila and Kodin Ykkönen, K-citymarket's home and speciality goods, Intersport Finland, Indoor's Asko and Sotka, Musta Pörssi and Kenkäkesko. The total number of home and speciality goods stores is 427, which operate in 13 chains. 190 of the stores are owned by Kesko.
Well-known and reliable store
chains in many product lines
Market
Kesko's home and speciality goods trade operates in the clothing, home, sports, leisure, home technology, entertainment and furniture product lines. The Finnish total market of home and speciality goods is estimated to be approximately €9.2 billion (VAT 0%).
Consumer confidence in the economy has improved after the recession, but the market growth has remained very moderate. Market development in the home and speciality goods sector varies depending on the product line. In 2010, market development was positive and gradual in all product lines, which can be attributed to growing consumer confidence and Sunday openings.
In Finland, the estimated market of interior decoration items and furniture is €1.5 billion (VAT 0%), representing an increase of 3.5% from the previous year.
The Finnish market for home electronics and entertainment is estimated to total some €1.6 (VAT 0%) billion, representing an increase of about 5%.
In Finland, the estimated sports trade market totalled €760 million (VAT 0%) and increased by 5%.
The shoe trade market increased by some 4.5% from the previous year in Finland.
Six development online stores
Kesko has several online stores selling home and speciality goods and their sales are increasing. Anttila's online store NetAnttila operates in Finland, Estonia and Latvia. For many years, NetAnttila has been the best-known and most popular online department store in Finland. Anttila also has the Kodin1.com online store, which specialises in interior decoration goods.
In sports trade, the Budget Sport online store operates as part of Intersport Finland.
The Konebox online store sells home technology. Konebox combines the best parts of online shopping and a traditional store.
A refurbished CM-store.fi was opened in 2010. Customers can download music to their computers and mobiles on this online store, which also sells talking books.
Year 2010
During 2010, cooperation intensified in Kesko's home and speciality goods trade, particularly in Anttila and K-citymarket. Since late 2010, Anttila and K-citymarket have had the same management to ensure the implementation of synergy benefits in purchasing and other operations.
The aim has been to improve the companies' competitiveness with a joint strategy and centralised retail expertise and by ensuring the availability of interesting store concepts for shoppers. Synergy benefits are sought, above all, in purchasing, in the development of the store network and through uniform and efficient business processes.
Kesko's net sales of home and speciality goods totalled €1,569 million in 2010, an increase of 0.7% from the previous year. The combined retail sales of home and speciality goods stores were €1,712 million (VAT 0%), an increase of 1.6%.
The operating profit of the home and speciality goods trade excluding non-recurring items was €66.0 million, representing an increase of €36.5 million from the previous year. The improved operating profit can, above all, be attributed to the improved profitability and purchasing efficiency.
Objectives and strategic emphases
Competition in the home and speciality goods trade is becoming more international and successful chains are based on efficient business models. The proportion of online business out of the total sales in the sector continues to increase. Kesko's online stores operate under well-known and reliable chain brands. Online business relies on a multi-channel approach, which allows customers to benefit from both the web and the traditional store. Online stores are being planned for all product lines in the home and speciality goods trade.
Cooperation between Kesko's home and speciality goods companies will be intensified further.
The home and speciality goods trade aims to be a market leader in selected product lines. This will be achieved by enhancing store concepts and selections, by increasing the cost-efficiency of operations chains and the staff's sales and service competence.
K-citymarket
K-citymarket is a diversified and favourably-priced hypermarket chain, which provides wide selections of groceries and home and speciality goods. K-citymarket Oy is responsible for the home and speciality goods business in the stores, while K-retailer entrepreneurs are responsible for the food business. The figures presented here refer to the K-citymarket's home and speciality goods trade. There are 69 K-citymarkets in Finland.
K-citymarkets offer their customers up-to-date, frequently changing selections of everyday goods, easily and at low prices.
Year 2010
In 2010, the net sales of K-citymarket's home and speciality goods totalled €620 million, which represented an increase of 4.2%. K-citymarket's retail sales of home and speciality goods amounted to €603 million.
In 2010, a new K-citymarket was opened in Iisalmi and the K-supermarket in Kankaanpää was refurbished and turned into a K-citymarket. The K-citymarket in the city centre of Pori was turned into a K-supermarket.
Anttila
Anttila retails entertainment, fashion and home goods.
Anttila department stores offer their customers wide selections of home goods, casual clothing and entertainment at low prices. Anttila has 30 department stores and one smaller speciality store in Finland.
Kodin Ykkönen provides smart, up-to-date products and services for home decoration. There are nine Kodin Ykkönen department stores for interior decoration and home goods, complemented with the Kodin1.com online store.
For several years, NetAnttila has been the best-known and most popular online department store in Finland. It offers low-priced and wide selections, easily and reliably. NetAnttila operates in Finland, Estonia and Latvia.
Year 2010
Anttila's net sales were €505 million in 2010, a decrease of 1.6%. Retail sales of Anttila department stores totalled €295 million, a decrease of 2.9%. Retail sales of Kodin Ykkönen department stores for interior decoration and home goods totalled €132 million, down 0.5%. Retail sales of NetAnttila amounted to €80 million, an increase of 0.9%.
In 2010, a new Kodin Ykkönen department store was opened in Lappeenranta, while the Kodin Ykkönen department store in Kaisaniemi, Helsinki, was closed due to the termination of lease.
In late 2010, Anttila's new logistics centre applying the latest, modern technology was completed in Kerava. It will be implemented gradually during the first months of 2011. The logistics centre will take care of deliveries to all Anttila and Kodin Ykkönen department stores and NetAnttila customers. The new logistics centre's floor area is 19,000 m2 and cubic volume 350,000 m3. The total capital expenditure of the project is €50 million, divided approximately half and half between the building and the warehousing technology.
Intersport Finland
Intersport Finland's retail store chains are Intersport, Budget Sport and Kesport. Intersport Finland is responsible for the marketing, sourcing and logistics services, store network and retailer resources of the chains. There are 56 Intersport stores, five Budget Sport stores and 35 Kesport stores in Finland, of which 89 are owned by retailer entrepreneurs and seven by Intersport Finland. They are complemented by the Budget Sport online store.
Intersport is part of the international sports chain. The Intersport chain is the market leader in Finnish sports retailing. Intersport provides clothing and equipment for keen enthusiasts and less active athletes, for sports and leisure purposes. Intersport's strengths include the chain's high reliability and recognition among customers, wide and diversified selections, and its expert and service-minded staff.
Budget Sport is a sports store format which is based on low prices and the cost-effective business concept. It offers products for leisure and versatile physical exercise, for sports and outdoor activities.
Kesport stores, located in smaller rural centres, are the leading sports stores in their areas and provide their customers with expert service and help.
Kesko is a partner of Intersport International Corporation.
Year 2010
The net sales of Intersport Finland were €173 million in 2010, representing an increase of 5.1%. The combined retail sales of Intersport, Budget Sport and Kesport stores were €262 million, up by 4.1%.
In 2010, a new Intersport store was opened in Rauma. Two Intersport stores and two Kesport stores were closed.
Indoor
Indoor's Asko and Sotka, well-known retail store chains selling furniture and interior decoration items, consist of 79 stores in Finland and seven stores in Estonia. In Finland, 55 of the stores are owned by Indoor, while 24 operate as a franchise.
Asko provides quality-conscious home decorators with a competitive product range combined with the most active and reliable service in the sector.
Sotka's main target group consists of customers who value low prices and easy shopping.
Year 2010
Indoor's net sales totalled €155 million in 2010, down 0.5%. The combined retail sales of the Asko and Sotka chains in Finland were €166 million, an increase of 6.3%.
In spring 2010, consumers selected Asko as the most reliable furniture store in Finland for the fourth time in succession in the 'Most Reliable Brand' survey made for the Finnish Readers' Digest.
Cooperation with the Allergy and Asthma Federation was intensified. The right to use the allergy label was granted to the Puro sofa by Asko.
In 2010, a new Asko store and a new Sotka store were opened in Raisio. They replaced the ones closed in Masku. In addition, five stores in Finland and all Asko and Sotka stores in Latvia were closed.
Musta Pörssi and Konebox
The Musta Pörssi chain of speciality stores offers its customers home technology products that make housework easier, enhance communications and provide entertainment. In addition, Musta Pörssi offers a range of product-related services and customers can choose to have the home technology installed ready to use. There are 46 Musta Pörssi stores, two Konebox stores and the Konebox online store in Finland. 44 of the stores are owned by retailer entrepreneurs and four by Musta Pörssi Ltd.
On the home technology market, the Konebox online store competes with quality products, good availability and low prices. Competitive prices are based on an efficient chain of logistics and warehousing combined with the online store's self-service.
Year 2010
The net sales of Musta Pörssi were €96 million in 2010, representing a decrease of 10.6%. The combined retail sales of the Musta Pörssi and Konebox stores were €119 million and, a decrease of 6.4% from the previous year.
In 2010, a new Konebox store was opened in Vantaa, while six Musta Pörssi stores in all were closed.
Kenkäkesko
Kenkäkesko's retail store chains are K-kenkä and Andiamo.
K-kenkä stores are shoe stores for the whole family, offering their customers a wide selection of branded footwear and expert service.
Andiamo stores cater for trendy and fashion-conscious consumers, for whom the store offers a fashionable selection of shoes that is constantly being updated.
The K-Group's shoe outlets also include the Kenkäexpertti stores which serve customers in smaller towns.
There are 82 K-Group shoe stores, of which 80 are owned by retailers and two by Kenkäkesko.
Year 2010
The net sales of Kenkäkesko were €23 million in 2010, a decrease of 6.5%. The combined retail sales of the K-Group's shoe stores amounted to €48 million, an increase of 0.3%.
Seven shoe stores were closed during the year.
A new logistics centre
Anttila's new logistics centre was completed in Kerava in late 2010. The centre will handle deliveries to all Anttila and Kodin Ykkönen department stores and to NetAnttila customers. Annually, the logistics centre will deliver over one million orders to Anttila's online customers.
E-commerce is expanding
In the home and speciality goods trade, the emphasis will be on the development of e-commerce and marketing. Music and talking books can be downloaded at CM-store and DigiAnttila sites, which were both refurbished in 2010. DigiAnttila also offers e-books.
Kesko's online stores in the home and speciality goods trade are:
Market shares and competitors
Hypermarket and department store trade- K-citymarket, Anttila, Kodin Ykkönen and NetAnttila
- Market share cannot be reliably calculated
- Competitors: department stores, hypermarkets, speciality store chains and online stores
- Intersport, Budget Sport and Kesport
- Market share 34% (own estimate)
- Competitors: Sportia, Top Sport, Stadium, department stores and hypermarkets, and other speciality sports stores
- Asko and Sotka
- Market share in Finland about 19% (own estimate)
- Competitors: furniture and interior decoration stores
- Musta Pörssi and Konebox
- Market share 8% (own estimate)
- Competitors: stores specialised in home technology, hypermarkets and online stores
- K-kenkä, Andiamo, Kenkäexpertti
- Market share 10.2% (Association of Textile and Footwear Importers and Wholesalers, own estimate)
- Competitors: other speciality stores, department stores, hypermarkets, sports stores and online stores
K-Group's home and speciality goods trade, |
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| Number | Sales, (VAT 0%) € million |
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| 2010 | 2009 | 2010 | 2009 | |
| Anttila department stores | 31 | 31 | 295 | 303 |
| Kodin Ykkönen department stores for interior decoration and home goods* |
10 | 10 | 132 | 132 |
| Distance sales (mail order and NetAnttila) |
1 | 1 | 72 | 71 |
| K-citymarket, home and speciality goods | 69 | 69 | 603 | 575 |
| Asko | 31 | 33 | 80 | 74 |
| Sotka | 48 | 50 | 86 | 82 |
| Intersport | 56 | 57 | 207 | 200 |
| Budget Sport* | 6 | 6 | 31 | 26 |
| Kesport | 35 | 37 | 25 | 25 |
| Musta Pörssi | 46 | 53 | 105 | 119 |
| Konebox* | 3 | 3 | 14 | 8 |
| Shoe stores | 82 | 89 | 48 | 48 |
| Home and speciality goods stores, Finland |
418 | 439 | 1,696 | 1,664 |
| Anttila, Baltic countries (NetAnttila) | 2 | 2 | 8 | 9 |
| Indoor, Baltic countries | 7 | 9 | 7 | 11 |
| Home and speciality goods stores, Baltic countries |
9 | 11 | 15 | 20 |
| Home and speciality goods trade, total |
427 | 450 | 1,712 | 1,684 |
* incl. online sales |
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|
2009 | 2008 | ||
| Net sales | € million | 1,558 | 1,606 | |
| Operating profit | € million | 66.5 | 63.6 | |
| Operating profit excl. non-recurring items | € million | 29.5 | 31.2 | |
| Operating profit as % of net sales excl. non-recurring items |
% | 1.9 | 1.9 | |
| Investments | € million | 29.6 | 60.5 | |
| Return on capital employed* excl. non-recurring items |
% | 5.8 | 6.2 | |
| Personnel average | 5,666 | 5,801 | ||
* cumulative average |
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Home and speciality goods trade |
€ million |
change, % |
||
| K-citymarket, home and speciality goods | 620 | 4.2 | ||
| Anttila | 505 | -1.6 | ||
| Intersport | 173 | 5.1 | ||
| Indoor | 155 | -0.5 | ||
| Musta Pörssi | 96 | -10.6 | ||
| Kenkäkesko | 23 | -6.5 | ||
| Total | 1,569 | 0.7 | ||
Home and speciality goods trade |
2010 | 2009 | ||
| Non-current assets | 315 | 304 | ||
| Inventories | 231 | 223 | ||
| Short-term receivables | 162 | 174 | ||
| ./. Non-interest-bearing debt | -291 | -260 | ||
| ./. Provisions | -9 | -8 | ||
| Capital employed** | 408 | 434 | ||
** capital employed at the end of month |
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