Westfalika selling platform: a network of sales and service outlets and an online platform

OR GROUP develops the Westfalika selling platform, which comprises a network of sales and service outlets throughout Russia and an online platform of the same name. On the platform, the Company sells both products of its own brands (private labels) and products of partners (marketplace). In 2020, the share of online sales accounted for 19.9% of the selling platform revenue.

In 2020-2021, the Group transformed the fashion store into a sales outlet with a universal range of goods, which has a positive effect on the conversion and the number of items in the receipt. As of 31 December 2021, the Group's retail network comprised 751 stores (177 of them — franchise stores) in more than 300 Russian cities. Most of the Company's outlets are developed in a street format. Large Company’s footprint in small towns gives OR GROUP a competitive advantage in terms of the development of online trading and new services in these localities. 

Company’s footprint, as of 31.12.2021. 

The Company has transformed the retail format and significantly expanded the range due to the transition to the marketplace model when dealing with suppliers. In 2021, the Group achieved significant results on this project: by the end of the year, the Company cooperated with more than 1000 partners; over the year, more than 3.2 million partner products were sold. Household goods became the leaders in terms of growth rate; among them 80% accounted for kitchen utensils, textiles, and small appliances. Textiles are the most high-margin product category. 

All interaction with partners is automated within the Продаем.рф (Prodayom.rf) platform. Client’s profile on platform is constantly improved, new functions are added, which allows the partner to manage the movement of goods online. The Prodayom online platform for interaction with suppliers (www.продаем.рф) received the Best Regional Project award of the Project of 2020 competition, organized by the GlobalCIO| DigitalExperts IT community (www.globalcio.ru).

Since 2020, OR GROUP has been rotating the product assortment as well as fashion collections in stores more frequently. Now the Company forms an assortment matrix for each month, which allows capturing seasonal fluctuations, short-term surges in demand for certain goods, and, as a result, increasing sales.

Omnichannel model

In its strategy, OR GROUP relies on the development of omnichannel trading, where the client is able to make purchases using different channels and tools while switching from one channel to another is «seamless» and the customer's interaction with the Company's brand becomes the priority.

The company is further redistributing customer flows in favor of online sales channels, as well as in the retail market as a whole. In 2021, the Group achieved good results in the online direction: the share of online sales in the revenue of the westfalika.ru selling platform reached 20.9%. During the Black Friday promotion, the increase in online sales was 44% in physical terms and 30% in monetary terms, compared with a similar promotion in 2020. Such results are explained by a significant expansion of the range and more effective promotion. In addition, the development of additional product categories allows OR GROUP to smooth out the seasonality typical for the fashion segment and maintain high demand for the assortment during the traditional seasonal decline in footwear and clothing sales. So, during the New Year holidays of 2022, the company's online revenue grew by a third. 

The proportion of customers making purchases using mobile devices is growing. So, for 10 months of 2021, the number of orders placed using the Westfalika mobile application has tripled; also doubled the number of app installs.

At the end of February 2021, OR GROUP moved the Westfalika.ru online platform to its server facilities in Novosibirsk as part of its online sales development strategy. This will allow the company to significantly improve the performance of the site, its manageability and efficiency; more flexibly and promptly implement changes; collect and process analytics on the online platform operation; organize a simpler and faster exchange with the company's databases; synchronize updates on the site and in the Westfalika mobile application.

The Westfalika.ru online platform is an extension of the Westfalika sales and service point, offering a wider range of products. To ensure the integration of online and offline sales channels, the Group develops a project of online order terminals in stores, where the customer can immediately place an online order for any product that is not in the store. At the same time, the shop-assistant will provide all the necessary consulting support, help to place an order. Thus, a more conservative audience, which does not have such experience yet, and customers from small towns, where online trading is still poorly developed, are involved in online shopping. All of the Group's stores are now equipped with online order terminals. 

The company is developing new distribution channels and collaborating with third-party marketplaces to sell private label products. In 2021 — early 2022 the Group introduced new schemes for cooperating with third-party marketplaces and started working with Wildberries, OZON and SberMegaMarket using the FBS system (fulfilment by seller — shipment of goods from the seller's warehouses). At these sites, the company presents mainly apparel, footwear and accessories under its own brands. This allows OR GROUP to expand its sales geography and attract new customers.