Sales spurred by dealer account rationalisation and sale of consumer website
Excalibur Distribution recorded its highest ever monthly turnover last month, following restructure of the business that saw 350 dealers cut for a focus on profitable and efficient accounts. It said it has sold off its e-commerce business to focus on core activity also.
The Basildon-based accessories distributor, sister-company of Vodafone dealership Excalibur Communications, saw sales for September more than double to £1.7 million compared to its previous six-month average.
It put the increase down to its restructure of the business, which saw it terminate more than 350 of its 650 dealer accounts for accessories purchases to increase focus on fewer “more valuable high-end” B2B dealers. It said it has also aligned the business more closely with its own Excalibur Communications business.
The move is to increase profitability, rather than low-margin turnover, it remarked.
Excalibur Group chief executive Gary Wetherall (pictured) said the 350 dealers culled contributed only two per cent of company sales, however. He said they were removed in the first instance for failing a number of other criteria, including high returns and late payments.
Wetherall said: “Customers ordering a phone case or charger here and there are not providing the kind of business we can build a business on. And so we have slimmed it down to get the quality right and to focus on core B2B dealers out there.”
Wetherall suggested some more accounts will be closed. “Ultimately it will sit around 300 accounts because we believe that’s the number we can provide the optimum service to. We need to provide the right range of products but we have been running around 3,000 different product lines [just to fulfil orders], which is far too many.”
He remarked: “If I’m honest, this has been a business that has chased a lot of turnover for not particularly fantastic profit. When I took charge, the first job was on distribution – which looked great from a turnover point of view, but required better margin.
“It’s great having 650 customers, but if it costs a disproportionate amount in overheads and staff to service them, then something has to give. We had to sacrifice something in turnover. We want a sounder and more profitable business, which is more aligned with the B2B [dealership] side.”
He said of September’s performance: “We had our best sales, ever, which seems strange considering the fact we have slimmed down the number of customers and our product range. But it shows we are doing a better job of serving our serious customers.”
Excalibur Distribution managing director Tony Harris added: “The main thing is the focus. We have cut out a lot of the smaller dealers we were working with who were high maintenance and costing us money. We are now able to offer an improved and more dedicated service to our key partners and bigger B2B dealers. We are more focused on the product range so we can now actively sell to them with targeted products.”
The firm has made a few redundancies from its account management team, but insisted the exodus has been slight and is now halted. Wetherall said: “We can’t compete at the same broad level as Data Select and 20:20 Mobile, and so we have to find our niche in the market.”
Excalibur Group has around 65 staff spanning across its offices in Basildon, Crawley, Basingstoke, Southampton, Swindon and Bristol.