Smeg MD: Consumers saw us as a refrigeration brand

18 Jul, 14

Newly-appointed MD of Smeg UK, Mike Giddings speaks to Kitchens & Bathrooms News

Like many companies, and not just those in the kitchen industry, Smeg UK felt the effects of the downturn in 2008. However, having weathered the economic storm, the appliance manufacturer has now set its sights on achieving record turnover. MD Mike Giddingsbelieves the company will hit its highest-ever turnover level in the next 12 months, “We’ve achieved mid-£40million in the past, and we’d be looking to go beyond that very soon. That for us is a very exciting threshold to get to.”

Cooking sales take-off

Some of the company’s most recent sales success could simply be attributed to promoting its existing appliance portfolio to consumers at a number of shows such as Grand Designs. Although Smeg has been present in the UK for the past 25 years, Giddings states some consumers still weren’t aware of its entire offer. He comments: “It was important because a number of consumers saw us as mainly a refrigeration brand and we needed to spread the word about the breadth of range that we’ve got.” He continues: “Yes, we are synonymous with refrigeration because of the iconic image of our retro refrigeration but we were making cooking products long before that…Cooking is coming up to 60% of our business and built-in is a rapidly growing part of that.”

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But arguably Smeg’s greatest foot up in sales was the company’s willingness to invest in new product development, further broadening its portfolio. “The one thing that means we have been able to kick on, in what has been a very flat market, has been the innovative products, with a prolific period of launches over the last few years coming up to this year at EuroCucina. We have never launched as many new products”, explains Giddings.

Entering SDA market

On top of its major domestic appliance launches, Smeg has launched small domestic appliances (SDA). Giddings believes it opens up a new customer base for the company. “It takes Smeg into a market that is slightly more accessible. A lot of people have aspirations to own a Smeg fridge or a Smeg product – it’s that type of brand. People who perhaps haven’t got the room for FAB refrigeration can now have a toaster or a kettle. It takes us into a whole different gift market, particularly via cook shops and department stores.”

Smeg is happy to be a niche player working across a broad range of appliance sectors. But this brings challenges to a brand, particularly as Smeg strives to hold all of its products in stock. The company has now increased its warehousing to cater for the increase in business. “We now have 110,000sqft in Portsmouth as we’ve just expanded by a third. We’ve a third more drivers, a third more warehousing space and a third more products. We’re also looking at probably, a third more customers since 2008.” 

Managing opportunities

With the proliferation of product launches and opening of new business opportunities, Giddings believes the biggest challenge to the Smeg business will be to manage all its sales possibilities. Although he comments: “I’d rather face the challenge of having too many products and too much opportunity than not enough”. Giddings concludes: “In a marketplace that is dominated by huge brands, the profitable survival of a company like Smeg is to stay different and offer something that is quite unique in the marketplace and we exist to do that. And when we get it right, the products we produce can change the face of the industry.”

The full article appears in the July/August 2014 issue of Kitchens & Bathrooms News