Reining in its online marketplace sales squeezed The Vitamin Shoppe’s overall sales in the fourth quarter.
Vitamin Shoppe, No. 215 in the Internet Retailer 2016 Top 500 Guide, does not break out e-commerce sales numbers but said it had a year-over-year e-commerce comparable sales decline of 5.0% in the fourth quarter ended Dec. 31 and a 3.8% gain for 2016.
“Our overall direct business was down 5% (during the fourth quarter) as we move away from selling on third-party marketplaces,” CEO Colin Watts told analysts on the call, according to a transcript from Seeking Alpha. Sales via VitaminShoppe.com increased 7% in Q4, driven largely by the re-platforming of the retailer’s website, he said.
The retail chain relaunched its website in November to make it and easier for shoppers to navigate, especially those on mobile devices. “In addition to comp growth of 7% for the quarter, our overall visits to the site increased by 9%, and conversion improved by 14%, driven by mobile conversions, which improved by 34%,” Watts said. “We are very pleased by the early and positive results we’ve seen since the relaunch.”
Vitamin Shoppe said direct sales during the fourth quarter were $31.1 million, down 4.0% from $32.4 million during the same time last year. Direct sales are mainly online, but also include catalog sales. For the year, direct sales grew 0.9% to $130.0 million from $128.8 million in 2015.
Vitamin Shoppe rolled out buy online, pick up in store a year ago as part of an initiative to use its store locations to fulfill online orders. Watts says those orders account for nearly 8% of the retailer’s online transactions.
For the fourth quarter ended Dec. 31, Vitamin Shoppe reported:
- Net sales of $304.9 million, up 3.9% from $293.5 million a year ago.
- A total comparable sales decline of 2.2%, compared with a decline of 0.3%.
- A net loss of $11.6 million, compared with a $6.1 million profit.
For fiscal 2016, Vitamin Shoppe reported:
- Net sales of $1.289 billion, up 1.7% from $1.267 billion last year.
- A year-over-year comparable sales decline of 0.9%, compared with flat comparable sales.
- A profit of $25.0 million, down 53.0% from $53.2 million.