Bargain chain Action had a good anniversary: in 2023, when it existed for thirty years, turnover grew by more than a quarter, to around 11 billion euros.
This growth was partly due to 303 new stores, and partly because more home, garden and kitchen supplies were sold in existing branches. In those ‘old’ stores, turnover increased by almost 17 percent.
Action now has 2,566 stores in eleven countries. It receives more than fifteen million customers every week. This is evident from the annual figures that Action published on Thursday.
It is the umpteenth year in a row that the Dutch bargain chain is growing. In 2022, turnover was 30 percent higher than in 2021, in which year growth was 23 percent. And these are years in which stores had to close and have other restrictions due to corona.
Rapid expansion
This growth in recent years was mainly due to the rapid expansion of the number of stores: at the end of 2020 there were still 1,716, but 850 stores have now been added. Most are in France (800), followed by Germany (500) and the Netherlands (about 400). Action will soon open its first stores in Portugal.
While many other stores achieved turnover growth in previous years through price increases due to high inflation, Action says it will have lowered prices in 2023. 40 percent of its range has been reduced in price, a spokesperson said earlier in return for The Telegraph. According to the general manager of the Dutch chain, Hajir Hajji, this involved 2,500 products. The British investment company 3i, major shareholder of Action, attributes 90 percent of the turnover growth to higher sales volume.
A small side note about the growth figures: in the last quarter of 2023, turnover in existing Action branches was ‘only’ about eleven percent higher than the year before. In addition to this leveling off growth, Action is suffering from problems in the Red Sea. The violence there hinders shipping and drives up transport costs. This also affects Action, which sources many products from Asia.
Action itself was once a bargain: 3i paid a paltry 500 million euros for a majority stake in 2011. The investor now estimates its value at around 13.8 billion pounds, approximately 16 billion euros.
Action paid out more than 220 million euros in dividends to 3i in 2023. Normally, the private equity investor resells companies after three to five years.