Online shop expands Haigh’s Chocolates reach

haigh's choclateAfter 100 years in business, Adelaide-based chocolatiers, Haigh’s Chocolates’, first foray into online retail is delivering on expectations.

Haigh’s Chocolates’ online store launched just before Christmas in 2014 and has experienced good growth over the last 14 months, in line with expectations, chief executive, Alister Haigh said.

What the business has been surprised by is that online sales are just as affected by the weather as instore sales are. One would assume that customers at home in air conditioning would shop differently to those traipsing past a store in the summer heat.

“We’ve been surprised that it has been almost as weather-affected in this month as our shops have,” Haigh said.

Haigh said he’d been pleasantly surprised at where online orders are coming from.

“It is fulfilling what we were hoping, to a degree, being able to supply customers around Australia without having a store there.

“Still, a lot of customers would like a store in their city, but that remains to be seen whether the sums add up for that or not.”

Online orders are dispatched from the South Australian distribution centre and the brand does not offer click and collect.

“The demand for click and collect would probably be at peak times, and so that would just compound our crowding issues in our stores,” Haigh said.

Foot traffic spikes in the stores around the key sales periods Easter, Christmas and Mother’s Day.

However he did raise the possibility “maybe down the track” of working in conjunction with other stores that don’t experience high traffic at Christmas and Easter as collection points for online orders.

“They might welcome people coming in and collecting Haigh’s Chocolates in their stores – it might help their businesses a bit. Who knows down the track, but there is nothing in the pipeline for that.”

Haigh’s Chocolates will open its third Sydney store in the first week of March, ahead of Easter Sunday, which falls on March 27 this year. The store, the retailer’s 15th Australia-wide, will open its doors in Chatswood Chase, on Sydney’s north shore.

Due to the company’s business model, any expansion or new store openings must be matched by manufacturing output.

“It’s really a question of manufacturing capacity,” Haigh said. “Because we make all our own products, we have to tailor our retail growth to our production capacity.”

Having complete control of supply, from manufacturing through to retail trade, comes with both pros and cons according to Haigh.

“It’s an advantage, but it’s also a disadvantage because you’ve got to find the capital to expand manufacturing as well as retail.”

With the existing stores already experiencing volume growth, Haigh said in 2016 the business will be investigating which new machinery will provide a “quantum leap” in production.

This article first appeared on Inside FMCG’s sister site, Internet Retailing.

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