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Company profile: Dunelm Mill

Homewares store with a value Dunelm Mill has carried strong momentum into 2023 following the blockbuster film 2022.

While its rival John Lewis was basking in the glory from John Lewis’s celebration of the Games, Dunelm enjoyed one of the most important moments of its history when it smashed the high-street bellwether off at the very top of homewares sales. The data on the share of customers in 2022 showed Dunelm beat the department store chain to take the 6.9 percent part of the PS11bn homewares market, beating John Lewis’ 6.8%.

The company’s success was evident financially the family-owned business saw a profit increase before tax of 15.1 percent to PS96.2m during the 52 weeks until June 30th, 2022. Like-for-likes increased by 3.1 percent, while revenue grew 12.1 percent to PS603.7m because its slogan, with the tagline ‘Simply value for money appeals to shoppers who are strapped for cash.

The company has a rags-to-rich story. The founders Bill Adderley and his wife Jean started by selling fabrics at a market stall in Leicester around 1979. Dunelm later built an enterprise on solid foundations before launching in 2006 and estimated at PS340m.

However, Bill Adderley, who still lives in the eastern Midlands is still grounded. In 2010, he said: “I like to watch some television as well as play golf, and I do things like you enjoy. I enjoy a takeaway meal and a pint, exactly as you do.” While Bill has retired from the company and his son Will who was previously chief executive, is now deputy executive chairman following the demise of the position of chief executive to the former Halfords Group Finance Director Nick Wharton in February 2021.

For Dunelm Live Chat visit this website.

Together, the Adderleys own nearly 55 percent of the shares, while Halfords Chief Executive Matt Davies is a non-executive director.

Dunelm’s approach to expanding stores has been weighed and the property now stands at 123 out-of-town shops and nine high-street shops. The estate covers a wide area across the UK including Cornwall up to Inverness and has five stores located in Northern Ireland.

The retailer has substantially increased its product range in its time of existence. Dunelm has integrated new high-end collections with its traditional fabrics that originated from the textile industry of the eastern Midlands.

The larger stores have fabrics shop-in-shops, while custom-made curtains are a major service that is supported by a dedicated unit located in Leicester.

Dunelm’s product range is now comprised of around 20000 lines, and covers everything from neon-colored kettles and football-inspired cushions. Since its categories have widened and so has the competition. Dunelm is currently fighting it against homewares rivals of all kinds.

The expanded assortment is an important element in its financial performance. Despite its money-saving offer, Dunelm experienced a slowdown in its growth rate and similarity to other brands as the recession grew worse between 2018 and 2021 however, it was buoyed by an increase in sales in 2019/20, due to new stores and low like-for-like comparisons. The retailer made a turn in 2012, however, as the summer heat and humidity brought shoppers to its stores.

Dunelm Mill operating performance

But profits continued to increase throughout the recession in the business sector that has always been characterised by a tight control of expenses.

The retailer has operated well and its operating margins and profits grew due to its efficiency gains which reduced the expense of refits to stores and financing store expansion with cash flow.

Recent improvements to systems have allowed employees to be more efficient in dealing with customers without additional costs for labor, thus improving customer service.

It also has an operation that is multichannel. It includes a transactional website that offers the complete assortment of products, as well as online exclusives, as well as a click-and-collect service.

In the autumn of last year, Dunelm launched a brand new catalog of 200 pages. The online sales were estimated to be around PS15m in the year before.
Retail Week Knowledge Bank notes: “Dunelm is predicted to continue to outperform the furniture industry due to its value-driven stance, taking into account it is believed that the UK economy is expected to be weak through the year 2023.” The future of the retailer is bright, even as the economy is still weak and they be looking to increase efficiency and gain enduring customer appeal.