UK's Majestic to rebrand as Naked Wines and close stores in major shake up
Majestic, the UK’s largest wine retailer has announced a major shake up of its business, with the closure of some of its 200 stores and a focus on its burgeoning Naked Wines division, with the company being rebranded Naked Wines.
Majestic acquired the online Naked business, which funds independent winemakers who produce products at preferential prices for its customers, in April 2015. Since then it has more than doubled in size, with sales expected to surpasss £175 this year, double that achieved in 2015 and bringing the total since acquisition to nearly £600m. Majestic said that almost 45% of its business came from online sales, with a further 20% from international sales.
Majestic did not specify how many stores it would close but said it hoped to keep job losses to a minimum through “migration” to the Naked brand. While its expectations for sales and profits this year were on track, Majestic's management said Naked's business model was the main driver of growth, accounting for a third of its group sales.
“It is clear that Naked Wines has the potential for strong sustainable growth, and we will deliver the best results for our shareholders, customers, people and suppliers by focusing all our energies on delivering that potential,” said group chief executive Rowan Gormley who founded Naked in 2008.
“We also believe that a transformed Majestic business does have the potential to be a long-term winner, but that we risk not maximising the potential of Naked if we try to do both.
“Where we have no choice but to close stores we will aim to minimise job losses by migration into Naked. Therefore we have taken a decision to focus all of our capital and energies into delivering the long-term potential of Naked, and releasing value from Majestic. Our plans for doing this are well advanced, and we look forward to sharing the final details in June."