Online marketplace retailer MyDeal bucks late 2021 trend with record growth

Online marketplace retailer MyDeal bucks late 2021 trend with record growth

MyDeal CEO Sean Senvirtne (provided)

Leading online retail marketplace (ASX: MYD) has revealed record quarterly milestones across key metrics ranging from sales to active customer numbers.

Founded by Sean Senvirtne (pictured) in 2011, MyDeal focuses on the home and lifestyle goods market and currently has more than 1,911 sellers on its platform, offering more than six million different products.

MyDeal continues to follow its strategic priority of investing in growth by relentlessly scaling the business to capture a growing share of the Australian e-commerce market, however this resulted in operating cash burn of almost $6 million in the December quarter.

 “Despite the ABS reporting a downturn in total Australian online retail sales of 8.7 per cent on November 21 and 6.1 per cent in October, MyDeal has been able to resist this trend and grow at a significant rate,” MyDeal CEO Senvirtne, who featured in the Australia's Top 100 Young Entrepreneurs List in 2021, said.  

“A key focus for Q2 FY22 was the successful execution of our In-stock strategy, which saw extraordinary gross sales growth of 240 per cent YoY, following the launch of third party brands in Q1 FY22."

As an intermediary, MyDeal facilitates transactions between merchants and consumers and has an in-stock offering comprising private label and third-party branded stock.

“In-stock, which also includes private label, now accounts for 12 per cent of gross sales," Senvirtne added.

Senvitne confirmed that the business would continue investing and expanding the in-stock range.

Gross sales showed strong growth, climbing 19.5 per cent on Q1 FY22 sales to $83.1 million, reflecting what the company sees as continued customer acquisition and retention.

Active customers reached a record high of 963,882, with more than 60 per cent of transactions stemming from returning customers.

Revenue increased 61.7 per cent on Q2 FY21 to $19 million and the company had a healthy cash balance of $40.1 million as of 31 December 2021, although this was down by more than $7 million from the start of the quarter.

Customer receipts climbed to $86.6 million, for the quarter, up 13.5 per cent on Q1 FY22.

“Australians continue to shift online for their home and lifestyle needs, and with e-commerce adoption, still low by global standards, we see strong growth ahead for the industry over the next three to five years,” Senvirtne said, addressing MyDeal’s outlook.

“With MyDeal’s value offering underpinned by an extensive marketplace range and growing In-stock business, the company is well placed to maintain its track record of market share gains in a growing market.

“H2 FY22 has started strongly with January gross sales growth of 32.4 per cent YoY for the first 18 days.”

Shares of MYD dropped 1.43 per cent for the day, as of 4pm AEDT, to $0.69.

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