For the first time in at least fifteen years, webshop Coolblue closes the year with a loss. The Dutch seller of electronics and white goods, among other things, was 6.2 million euros short in 2022, according to the annual report, which was published on Thursday. A year earlier, Coolblue recorded a net profit of more than 39 million euros.
According to founder and CEO Pieter Zwart, the red numbers are mainly the result of the rapidly rising costs. For example, the third largest internet seller in the Netherlands spent more on energy, but also on salaries and cardboard, for example. “It is difficult to find a price that falls”, Black summarized the year opposite The Financial Times.
Coolblue itself prefers to screen with the profit before taxes and one-off costs. It was positive, 43 million euros, although that was also about half compared to a year earlier. And a big dip compared to the successful year 2020, when Cool-blue left a gross profit of 114 million euros, and achieved its highest net profit ever after deduction of tax and incidental expenses: 61 million.
The results show that Coolblue, like many of its competitors, has to get used to a new reality. With the rise of online shopping, internet shops have seen their sales increase almost continuously over the last twenty years. The outbreak of the corona virus gave this trend an extra push: when the entire country was suddenly housebound at the beginning of 2020, the Dutch ordered new webcams, screens, freezers, sandwich makers and sports mats en masse. via the Internet.
Sales jumps
At Coolblue, that sudden demand almost led to scarcity, but also to one of the biggest sales jumps in the company’s history. Sales increased by 34 percent in 2020 to just under 2 billion euros. In the second year of the pandemic, the orange-blue webshop continued that line, although growth leveled off at 18 percent.
Outside the company, the turnaround was already visible at that time: growth slowly turned into contraction in the entire consumer electronics market in 2021. This development has now also spread to internet sellers: almost all of them feel how consumers are spending less. For example, sales of the American giant Amazon fell in the first, second and fourth quarters. Online clothing retailer Zalando also experienced shrinkage in the second quarter of 2022 for the first time since its foundation in 2008.
Coolblue CEO Pieter Zwart still sees plenty of opportunities to grow
This is no different in the Netherlands. Last week, Ahold Delhaize reported in its annual figures that subsidiary Bol.com shrank last year. At 5.5 billion euros, the sales of the largest webshop in the Netherlands were 1.9 percent lower than one year previously. Coolblue reported a small plus on Thursday, up to 2.4 billion euros, although Zwart acknowledged that this 0.6 percent extra turnover is not really noticeable in addition to the spectacular growth figures of previous years.
According to the Coolblue CEO, this has everything to do with the historically low consumer confidence, he told Het Financieele Dagblad. “That is literally an index of three questions, the last of which is whether you think it is a suitable time to buy durable consumer goods, such as a washing machine or television. If you are in that sector, like we are, then that says something.”
Rising interest
Both Ahold and Coolblue draw hope from the fact that although they are performing less than before, they are still outperforming the entire market. For example, Ahold CEO Frans Muller emphasized last week that Bol.com still shines with a minus of 1.9 percent in a relative sense, as competitors lost 6 percent. Zwart placed his minimal growth in a similar perspective: other electronics sellers lost 2.6 percent in turnover, he said.
Nevertheless, something has undeniably changed for online stores: due to rising interest rates and economic uncertainty, they no longer have virtually endless stocks of growth capital. Last year, Ahold canceled its plans to list bol.com on the stock exchange due to a lack of interest from investors. Coolblue did the same a year earlier, due to “uncertainty in the financial markets”.
It also means that growth of the market share is no longer the top priority for growth companies such as online stores, and they have to pay more attention than ever to their expenses. This became apparent at bol.com at the end of last year: the company announced cutbacks and laid off 300 employees, 10 percent of the whole. Coolblue also wants to become more efficient, says Zwart. The company cut more than 300 jobs last year, more than 5 percent of the total.
Although his company had a “challenging year”, CEO Zwart still sees plenty of opportunities for growth. This year he wants to expand further with Coolblue Energy, the energy supplier he set up in 2021. In addition, Coolblue noticed last year that there is still a lot of growth in the sale of products to save energy, such as solar panels and smart lighting.
Germany will also remain an important growth market for the coming years, according to Zwart. Coolblue has been active there since mid-2020 and sold 174 million euros worth of products there last year, more than 85 percent more than a year earlier. The internet shop aims to turn over a billion in Germany by 2025.
A version of this article also appeared in the newspaper of February 24, 2023