Dixons Retail focuses on customer satisfaction as downturn bites

Firm's first-quarter financials show a seven per cent drop in group sales due to 'challenging' market conditions

Dixons Retail's latest financials have laid bare the strain being felt by the high street, with a seven per cent drop in sales across the group for its first fiscal quarter of the year.

UK sales dropped 10 per cent for the quarter ending 23 July 2011, but the firm said its Nordic operations continue to perform well, and both Italy and Greece are trading "ahead of weak markets".

According to the statement posted on its site, the UK sales figures were boosted last year by the World Cup and the launch of the iPad, a success that the company has struggled to replicate this quarter.

The statement revealed that the firm plans to spend approximately £100m this year on transforming its stores, and it has identified £10m cost savings for the year ahead.

Its store refit programme is also on track with 375 stores transformed across the group. Some 71 megastores are now open, including 32 in the UK.

John Browett, group chief executive, said the firm’s focus on customer satisfaction was paying dividends. “This performance was in line with our expectations when compared with particularly strong trading last year as a result of the World Cup and launch of the iPad,” he said. “While underlying market conditions have remained challenging this year, we have continued to trade ahead of our markets as customers respond to our improving customer offer.

“I am particularly pleased with the significant and ongoing improvements we have seen in customer satisfaction measures in the UK, which demonstrate the success of our renewal and transformation plan, as well as our continued strong trading in the Nordics. We remain on track for full-year expectations.”

However, Browett added that the firm remains “cautious” about the economic outlook.