Sainsbury's Tu Clothing becomes £1bn brand as e-sales soar

By

Nigel TAYLOR

Published
Apr 28, 2022

Its plan to “put food back at the heart of Sainsbury’s” may have been the main message in the UK supermarket giant’s year-end trading statement, but fashion is where the business is operating strongly.

Tu Clothing is now a £1 billion brand, Sainsbury’s understatedly announced lower down in its annual results statement on Thursday. 

Under the heading ‘Brands That Deliver’ it said Tu sales for are now so strong they’re 3.1% ahead of the pre-pandemic 2019/20 period. 

Alas, there was no news from the business on which Tu categories performed the best. But what we do know is that the brand’s overall success was underpinned by “good" online sales, which translates to an impressive 49% hike against two years ago.

Over the last 12 months, Tu clothing delivered sales growth of 12.7% to deliver sales that broke that important £1 billion barrier.

What’s more, Sainsbury’s also said it was now selling more clothing at full price, running at 89% compared with 65% two years ago. And this was achieved by running fewer promotions, it noted.

And while clothing might not be core to the operation, the retailer did note that Tu’s success “improves profitability and supports increased investment in our... food business”.

Overall, profits at Sainsbury’s raced brand into the black after a year of losses, as the supermarket enjoyed the benefits of 'essential business’ status during the pandemic. Pre-tax profits for the 12 months to March 5 hit £854 million, compared with a £164 million pre-tax loss a year earlier.

Total retail sales including fuel rose 3.4%. Excluding fuel, sales fell 2.6%.

But General Merchandise sales fell 4.6% versus FY 2019/20 and were down 11.9% on a year ago, “reflecting availability challenges in key product areas and our focus on profitable sales”.

However the supermarket warned that profits would be dented in the coming year as it reduces prices to help customers with the cost-of-living crisis.