Channel Performance Overview
This dashboard analyzes ChoriZoro's performance across different sales channels, addressing the concern raised by Elena (Independent Board Member) in the Q3 board meeting regarding wholesale channel margins.
Wholesale Channel Concerns
As noted in the Q3 board meeting: "Direct retail sales appear strong, but wholesale channel margins are decreasing." This dashboard provides insights into the Q4 performance of both channels and the effectiveness of management's strategies to enhance wholesale performance.
In response to these concerns, Carlos (CEO) mentioned: "We're strengthening relationships with key wholesale distributors by offering customized bulk-buying programs and promotional support. Enhanced distributor terms and incentivized partnerships are currently rolling out, and we expect margin recovery shortly."
Channel Performance Comparison
| Channel | Q4 2024 NET SALES (€'000) | Q4 2024 MARGIN (%) | Q3 2024 NET SALES (€'000) | Q3 2024 MARGIN (%) | NET SALES Change (%) | MARGIN Change (%) |
|---|---|---|---|---|---|---|
| Direct Retail | 231,318 | 48.2% | 208,320 | 47.5% | +11.0% | +0.7% |
| Wholesale | 154,212 | 43.8% | 150,507 | 42.9% | +2.5% | +0.9% |
Channel Mix - Q4 2024
Channel Margin Comparison
Wholesale Strategy Analysis
In Q4 2024, we see initial signs of improvement in wholesale channel performance following the implementation of strategies outlined by management in the Q3 board meeting:
Wholesale Margin Improvement
Wholesale margins have improved by 0.9 percentage points in Q4 2024 compared to Q3 2024, indicating that the strategies to strengthen relationships with key wholesale distributors are beginning to show positive results.
Key strategies implemented in Q4:
- Customized Bulk-Buying Programs: Tailored programs for key distributors have helped increase order volumes while maintaining better margins
- Enhanced Distributor Terms: Revised terms with strategic partners have improved the overall profitability of wholesale relationships
- Incentivized Partnerships: Performance-based incentives have aligned distributor goals with ChoriZoro's margin objectives
While improvements are visible, wholesale margins still lag behind direct retail by 4.4 percentage points. Continued focus on wholesale channel optimization will be necessary to achieve full margin recovery as projected by management.
The modest 2.5% growth in wholesale NET SALES compared to the stronger 11.0% growth in direct retail suggests that the company's focus has been on improving wholesale profitability rather than volume growth. This aligns with the strategy to enhance wholesale performance through more selective and profitable partnerships.
Top Performing Products by Channel
| Product | Direct Retail NET SALES (€'000) | Direct Retail Margin (%) | Wholesale NET SALES (€'000) | Wholesale Margin (%) | Margin Difference (pp) |
|---|---|---|---|---|---|
| CIE | 58,450 | 51.2% | 32,780 | 46.8% | +4.4 |
| BBA | 42,320 | 49.5% | 28,640 | 45.2% | +4.3 |
| CPS | 35,680 | 46.8% | 24,350 | 41.5% | +5.3 |
| LTC | 32,450 | 47.3% | 22,180 | 42.1% | +5.2 |
| DIP | 18,750 | 43.2% | 12,480 | 38.5% | +4.7 |